Climbing the property ladder: An analysis of market integration in London property prices

We investigate the long-run convergence of house prices across the London boroughs based on a pairwise unit root probabilistic testing procedure. In sharp contrast to the earlier literature, we employ a dataset that distinguishes between four different types of property in each borough. Using a quarterly dataset that spans from 1995 to 2014, we find evidence in favour of long-run convergence thereby suggesting that the great majority of London borough house prices are driven by a single common stochastic trend. In a further contribution, we offer new insights through analysing the determinants of long-run convergence, by considering the role of geographic proximity, type of accommodation and amenities (quality of life). 我们采用成对单位根概率测试程序调査伦敦各自治市区房价的长期趋同现象。与此前文献形 成鲜明对比的是，我们采用的数据集区分每个自治市区的四种不同类型的物业。基于从 1995年到2014年的季度数据集，我们发现了支持长期趋同的证据，从而表明伦敦各自治市 区的大多数房价都是由一个共同的随机趋势驱动的。本文进一步的贡献是，通过考虑地理接 近性、居住和设施类型（生活质量）的作用，我们分析了长期趋同的决定因素，提供新了的见解。