Detection and prediction of house price bubbles: evidence from a new city

Hanwool Jang, Kwangwon Ahn, Dongshin Kim, Yena Song*

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingConference contribution

12 Citations (Scopus)


In the early stages of growth of a city, housing market fundamentals are uncertain. This could attract speculative investors as well as actual housing demand. Sejong is a recently built administrative city in South Korea. Most government departments and public agencies have moved into it, while others are in the process of moving or plan to do so. In Sejong, a drastic escalation in house prices has been noted over the last few years, but at the same time, the number of vacant housing units has increased. Using the present value model, lease-price ratio, and log-periodic power law, this study examines the bubbles in the Sejong housing market. The analysis results indicate that (i) there are significant house price bubbles, (ii) the bubbles are driven by speculative investment, and (iii) the bubbles are likely to burst earlier here than in other cities. The approach in this study can be applied to identifying pricing bubbles in other cities.
Original languageEnglish
Title of host publicationComputational Science – ICCS 2018
EditorsYong Shi, Haohuan Fu, Yingjie Tian, Valeria V. Krzhizhanovskaya, Michael Harold Lees, Jack Dongarra, Peter M. A. Sloot
Number of pages14
ISBN (Electronic)9783319937137
ISBN (Print)9783319937120
Publication statusPublished - 12 Jun 2018
Event18th Annual International Conference on Computational Science - Wuxi, China
Duration: 11 Jun 201813 Jun 2018 (Link to conference website)

Publication series

NameLecture Notes in Computer Science
ISSN (Print)0302-9743
ISSN (Electronic)1611-3349


Conference18th Annual International Conference on Computational Science
Abbreviated titleICCS 2018
Internet address


  • Newly developed city
  • Real estate bubble
  • Complex system


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