Browsing by Subject "House price"

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    Essays on housing market and bank loans
    (2022-08) Ayberk, İdil
    This dissertation comprises three essays about the housing market and banks’ loan portfolios at the province level in Turkey. The first essay focuses on the supply side of the housing market. The price elasticity of housing supply is estimated using quarterly data over the period 2008-2017, and the factors that drive the differences across provinces are investigated. We find that Turkey has a low housing supply elasticity on average, but elasticity estimates exhibit variation across provinces. Our results suggest that population, geographical constraints and local regulatory conditions are significant factors in explaining the differences in housing supply elasticity estimates. In the second essay, we answer the question of whether banks change their loan allocation with the appreciation of house prices and whether state-owned banks behave like other banks with different ownership structures by using province-level data over the 2007Q4–2015Q2 period. The undevelopable land share and mortgage rate are employed as instruments for house price growth. We find that commercial loans are crowded out by mortgage, consumer, and construction loans with the increase in house prices; in addition, state-owned banks are found to reduce their commercial, and in particular agricultural loans, more than private banks as house prices appreciate. In the third essay, we examine the effect of house price appreciation on non-performing loans (NPLs) of domestic banks between 2009Q1–2016Q4, when real house prices were increasing. We document that non-performing total, commercial, and consumer loans decline as house prices increase. No difference among banks by ownership type is observed.
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    House prices and bank loan portfolios in an emerging market: The role of bank ownership
    (Elsevier, 2022-01) Ayberk, İdil; Önder, Zeynep
    Evidence from developed markets suggests that banks increase their mortgage loans with house price appreciation, but the findings for commercial and consumer loans are mixed. How do banks change their loan allocation with the appreciation of house prices in an emerging market? Do state-owned banks behave differently? We answer these questions using province-level data from Turkey over 2007Q4–2015Q2 and unavailable land share and mortgage rate as instruments for house price growth. We find that banks substitute away from commercial and industrial loans to mortgage, consumer, and construction loans as house prices appreciate. In addition, state-owned banks misallocate their loans by reducing their commercial and agricultural lending more than private banks. Our results imply that the policymakers should consider the adverse effects of house price appreciation due to the crowding-out of commercial loans, especially by state-owned banks