Události

Let us invite you to a Brown Bag Seminar by Kamila Sommer, Section Chief, Consumer Finance, Board of Governors, Federal Reserve System, on Wednesday, December 10, from 13:00 at room 402. You can also attend online.

Presenter: Kamila Sommer (Tato e-mailová adresa je chráněna před spamboty. Pro její zobrazení musíte mít povolen Javascript.)

Title: "The Marginal Propensity to Extract Housing Wealth: Evidence from Home Equity Windfalls"

Abstract: We estimate the marginal propensity to extract home equity, exploiting the shock to housing wealth that occurs when a household buys a home at a price below its true market value. True market value is estimated from professional appraiser’s valuations, which we show accurately predict the home’s subsequent sale price when they exceed current sale price and are effectively randomly distributed. We show that households borrow 13 cents against each dollar of marginal housing wealth within seven years of purchase. They extract an additional 20 cents through home sales, with approximately half reinvested as down payments on subsequent purchases. Other consumer debt remains unaffected. By tracking equity extraction over seven years post-purchase, we document substantial lags in the transmission of housing wealth shocks to consumption, advancing the understanding of how monetary policy affects consumption through house prices.

You can join the seminar in person at the following address:
CERGE-EI, Politických vězňů 7, Praha 1, room 402

Meeting link: TBA
Meeting number: TBA
Meeting password: TBA