Housing markets have played a prominent role in macroeconomic developments over recent years.
For a great part of the 2000s, buoyant housing markets have contributed to sustained economic activity in
most OECD countries. But many markets overheated and the collapse of the US subprime mortgage
market has been at the epicentre of a deep financial and economic crisis. Against this background, this
paper: i) documents housing market developments in 18 OECD countries since the 1970s, putting recent
evolutions into historical perspective; ii) examines the drivers of supply and demand for housing; iii)
investigates the interactions between housing markets and the wider economy; iv) assesses the
responsibilities of housing taxation, monetary policy and financial supervision and regulation in fuelling or
amplifying housing booms; v) explores the link between global imbalances and housing booms.
