Revisiting metropolitan house price-income relationships

Elias Oikarinen, Steven C. Bourassa, Martin Hoesli, Janne Engblom

Research output: Contribution to journalArticlepeer-review


We explore long-term patterns of the house price-income relationship across the 70 largest U.S. metropolitan areas. In line with a standard spatial equilibrium model, our empirical findings indicate that regional house price-income ratios are typically not stable, even over the long run. In contrast, panel regression models that relate house prices to aggregate personal income and allow for regional heterogeneity yield stationary long-term relationships in most areas. The house price-income relationship varies significantly across locations, underscoring the importance of using estimation techniques that allow for spatial heterogeneity. The substantial regional differences are closely related to the elasticity of housing supply.
Original languageEnglish
Article number101946
Number of pages21
JournalJournal of Housing Economics
Early online date23 May 2023
Publication statusPublished - 1 Sept 2023

Bibliographical note

For helpful comments, we thank the editor Jeff Zabel and two anonymous reviewers, as well as Christian Hilber, Simon Lapointe and Oskari Vähämaa, and participants at the International AREUEA conference in Amsterdam, ARES conference in San Diego, ERSA conference in Cork, ERES conference in Delft, Annual Meeting of the Finnish Economic Association, and research seminar at the University of Cambridge. We also thank Andrew VanValin for preparing the maps. This work was supported by the Strategic Research Council at the Academy of Finland (first author; decision numbers 352450 and 352451) and the West-Finland Housing Association of Public Utility.


  • house prices
  • personal income
  • Spatial equilibrium
  • regional heterogeneity
  • supply elasticity


Dive into the research topics of 'Revisiting metropolitan house price-income relationships'. Together they form a unique fingerprint.

Cite this