Although the value of our property might rise, we do not on
that account increase our consumption. This is the conclusion by economists
from University of Copenhagen and University of Oxford in new research which is
contrary to the widely believed assumption amongst economists that if there
occurs a rise in house prices then a natural rise in consumption will follow.
“We argue that leading economists should not wholly be
focussed on monitoring the housing market. Economists are closely watching the
developments on the housing market with the expectation that house prices and
household consumption tend to move in tandem, but this is not necessarily the
case,” says Professor of Economics at University of Copenhagen, Søren
Leth-Petersen.