An analysis on the effect of the COVID-19 pandemic on the housing demand in Finland
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School of Business |
Bachelor's thesis
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Authors
Date
2021
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Mcode
Degree programme
Bachelor’s programme in Economics
Language
en
Pages
37
Series
Abstract
This empirical work studies the effect of municipality characteristics on the demand for housing in Finland during the COVID-19 pandemic. It analyses how home prices, rents, the number of sales and the number of tenancy agreements have been affected by the pre-pandemic density, house and rent prices, households' average earned income, degree of urbanization and percentage of commuters. The purpose is to elaborate on whether some municipality characteristics have had a negative or positive effect on housing demand in order to infer whether this could possibly result in the settlement of a new spatial equilibrium. The rental market and real estate market data was collected from the first quarter of 2019 to the third quarter of 2021. It is found that density, income, the share of commuters and the degree of urbanization have had a positive effect on house prices and rent prices, whereas they affected negatively the number of tenancy agreements. The number of sales were affected positively by both income and pre-pandemic rent and house prices. The results conflict with the existing studies of US and UK ZIP-code level analysis, which find that there has been a significant decrease in demand in dense areas. The differences are attributed to demographic and social dissimilarities between the countries and the different severity degrees of the COVID-19 pandemic.Description
Thesis advisor
Stryjan, MiriKeywords
housing, COVID-19, pandemic, Finland, municipalities, demand