The economic literature suggests that institutional
characteristics of the real estate market produce
inefficiencies that contribute to price volatility.
However, no study has attempted to test the relative
contribution of the competing hypotheses to
inefficiency in regional real estate markets, and
their implications for price dynamics. This book,
based on my Ph.D. dissertation, identifies
volatility in housing prices by testing for market
inefficiency, quantifies those characteristics of
local real estate markets which contribute to price
volatility, and tests a model for the US housing
market which incorporates local market
characteristics and speculative behavior. The
results show that prices in U.S. real estate markets
have been volatile, and suggests that price bubbles
have been present in a number of US cities from the
mid-1980s through 2000.