Housing Bubbles: A Survey
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The past 25 years have represented two periods of extreme movements in U.S. and global house prices that appear to be much larger
than can be easily explained by changes in fundamentals. These episodes spurred research on housing bubbles that focused attention
on the role of outsized expectations in excessive house price appreciation. By contrast, some economists pointed to alternative
explanations for excess volatility, including liquidity constraints, lending cycles, search externalities, and zoning delays. Empirical
work supports the role of these factors in explaining at least some of the cyclical variation of house prices and inventories of homes
for sale. Existing research does not yet provide a crisp definition of a housing bubble nor does it allow researchers to predict where
or when bubbles can occur.
Mayer, Christopher. "Housing Bubbles: A Survey." Annual Review of Economics 3 (2011): 559-577.