Description

The residential rental market in Chile has experienced a significant growth in the last 15 years. Monitoring and understanding the real estate sector has gained relevance since the Global Financial Crisis, due to its role in the onset of this episode. Despite, information for the local market is scarce. In Chile, this sector is also relevant for the financial system and the real economy, since it interacts with several sector, including households, firms and the financial sector. In this paper, we propose new indicators, based on internet listings, and we study their implications on the evolution of the sector. Using these new measures we found that in the last decade the sale and rental house prices increased transversally across geographical areas in Santiago. We also find the proposed slack measure is relevant for price dynamics at the micro level. Thus, during episodes of lower availability we find evidence of significant price pressures in the short term.