Effects of Cost of Mortgage on House Prices: The Role of the Maturity Structure of Mortgage Contracts
Bibliographic record
Abstract
This paper examines the implications of the maturity structure of mortgage contracts for the effects of the cost of mortgage on house prices. Theoretical results indicate that economies with larger shares of variable interest rate mortgage contracts present faster responses of house prices to changes in the cost of mortgage, as well as higher interest rate sensitivities of cost of mortgage and house prices. Lower mortgage rate levels, higher loan-to-value ratio, and higher effects of cost of mortgage on house prices also increase these sensitivities. Empirical results validate the theoretical ones. Local projections estimated for the US, UK, Sweden, Canada, Finland and France show negative and significant responses of house prices to shocks on the cost of mortgage, with responses being faster in economies with larger shares of variable interest rate mortgage contracts. Estimates of the interest rate sensitivity of the cost of a mortgage are also in line with theory and increase as the mortgage rate declines. This sensitivity is attenuated when the central bank shifts its focus of monetary policy towards longer-term rates or when the effective lower bound is perceived to be lower.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.012 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.000 | 0.000 |
| Science and technology studies | 0.000 | 0.000 |
| Scholarly communication | 0.001 | 0.002 |
| Open science | 0.000 | 0.001 |
| Research integrity | 0.001 | 0.001 |
| Insufficient payload (model declined to judge) | 0.003 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".