Do Lifelong Experiences of Land and Housing Prices Affect Homeownership in Japan?

Using Japanese household data, this study tests whether experiencing growth in land or house prices over a lifetime influences homeownership. The results show a positive effect on this relationship. To test the hypothesis, this study calculates the lifelong weighted average of real land or housing price growth while estimating a parameter that determines the shape of the weight function. The study corroborates my results using US data. The results---using both Japanese and US data---are consistent with the belief channel, that is, experiencing price growth affects homeownership by influencing expectations of returns from housing investment