We have studied the relation between bank deposit rates and house prices in Iran. For that, we have run some VAR models, using the following variables: real deposit rates (including 1 and 5 years deposit rates), money supply (including the high powered money and the liquidity), GDP, housing services index, and number of licenses for new houses. Our results show that a reduction in the deposit rates reduces its attraction and increases demand for housing as an alternative asset to stock wealth. In other word, we find that there is a negative relation between bank deposit rates and house prices.
JEL classification: E43, G12, R21, R31
Heydari, H., & Soori, A. R. (2010). Analyzing the Relation between Bank Deposit Rates and House Prices in Iran. Journal of Economic Research (Tahghighat- E- Eghtesadi), 45(3), -.
MLA
Hassan Heydari; Amir Reza Soori. "Analyzing the Relation between Bank Deposit Rates and House Prices in Iran", Journal of Economic Research (Tahghighat- E- Eghtesadi), 45, 3, 2010, -.
HARVARD
Heydari, H., Soori, A. R. (2010). 'Analyzing the Relation between Bank Deposit Rates and House Prices in Iran', Journal of Economic Research (Tahghighat- E- Eghtesadi), 45(3), pp. -.
VANCOUVER
Heydari, H., Soori, A. R. Analyzing the Relation between Bank Deposit Rates and House Prices in Iran. Journal of Economic Research (Tahghighat- E- Eghtesadi), 2010; 45(3): -.
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