Publication: Bubbling Away

Kenyon Associate Professor of Economics, Galina An, has recently published an article on real estate forecasting, titled “Bubbling Away: Forecasting Real Estate Prices, Rents, and Bubbles in a Transition Economy.” It can be found in the October 2020 issue of Comparative Economic Studies.


Real housing prices have both surged and swooned in formerly socialist countries. We use 2000–2017 aggregate housing sales and rental price data from Kazakhstan to explore price movements during boom and stagnation eras, investigating the rent–price ratio’s (RPR) capacity to predict housing returns and rent growth for an emerging post-Soviet economy. RPR predicts returns better during periods of price increases than declines, and its importance in predicting the bubble component diminishes with time. Short-run RPR changes are consistent with rational bubble behavior during the period of secular upswing but different predictive variables matter during price increases and declines.

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