A model of the term structure of lease rates in a frictionless economy is developed and its predictions are compared with data on residential leases in Japan. The model shows that the initial lease rate for a cancellable lease must be set higher than that for a non-cancellable lease because the...

National housing markets differ in many aspects, making cross-national studies a fascinating subject. This article sheds light on housing demand in Germany and Japan. The primary task undertaken is to separate cross-national differences in the structure of housing demand by differing preferences...