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Francke, M. and Korevaar, M. (2025). Baby Booms and Asset Booms: Demographic Change and the Housing Market The Journal of Finance, 80(5):3021--3056.

  • Journal
    The Journal of Finance
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Based on centuries of data, we demonstrate that demographics have been a major, predictable driver of house prices. High birth rates 25 to 29 (60 to 64) years ago predict declining (rising) rent-price ratios today. This pattern arises from age-concentrated entry into and exit from homeownership affecting house prices, rather than changes in housing consumption that could also impact rents. We provide evidence for possible mechanisms: slow responses of other market participants to shifts in homeownership demand, and geographic segmentation between rental and owner-occupied markets. Evidence for age-dependent demand effects on yields of bonds and stocks is significantly weaker.