Recipient of the 2023-2024 Scarthingmoor PhD Prize in Economics for best PhD thesis from Queen's University.
ABSTRACT: This paper analyzes how U.S. households form home price expectations over short (12-month) and long (5-year) horizons using micro-level data from the University of Michigan Survey of Consumers. Short-run forecasts respond positively to past local price growth, consistent with extrapolative beliefs, while long-run forecasts exhibit mean reversion, with households adjusting expectations in the opposite direction of recent trends. Short-run updating also varies by age and income, whereas long-run expectations are more uniform. These results underscore the importance of both forecast horizon and respondent characteristics in shaping belief formation.