Abstract

CEDIEL SANCHEZ, Vanessa  and  VELASQUEZ VEGA, Carlos. Is there a housing bubble in Bogota? A market segment study. Rev.econ.inst. [online]. 2015, vol.17, n.32, pp.233-257. ISSN 0124-5996.  https://doi.org/10.18601/01245996.v17n32.08.

In 2014 Bogota's housing prices surpassed the historic average and the highest price registered to date. This raises the question of the existence of a possible housing bubble. In this article a univariate test of explosive growth for nine zones of the city was applied, in order to identify if the increasing housing prices are explained by speculation. This study found evidence of exuberant growth in most of the zones, although it showed differing dynamics within the city. In the most expensive districts part of the behaviour of prices is due to speculation. In contrast, in lower value zones prices are explained by demand pressures and earning improvements as well as government aids reflected on housing interest rate reduction for these segments of the population.

Keywords : Housing bubbles; Bogotá; unit root test.

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