A reconceptualisation of the housing cycle based on household upgrading desires

Purpose The paper sets out a conceptualisation of the housing cycle centring on households' desire to upgrade their housing consumption. Design/methodology/approach The paper begins by studying house price trends and cycles in OECD countries since 2000 to identify housing cycle patterns. It then assesses existing theories partly in relation to these patterns. It then proposes a new conceptualisation of the housing cycle. Findings The paper finds the central role of supply lags in housing cycles is not warranted. Instead, a demand cycle generated by upgrading desires better explains an initial boom followed by a slow recovery. Originality/value The paper challenges existing orthodoxy on housing cycle dynamics and proposes an alternative perspective.