{"title":"Who bears the burden of real estate transfer taxes? Evidence from the German housing market","authors":"Mathias Dolls , Clemens Fuest , Carla Krolage , Florian Neumeier","doi":"10.1016/j.jue.2024.103717","DOIUrl":null,"url":null,"abstract":"<div><div>This paper examines the effects of real estate transfer taxes (RETT) on property prices using a rich micro dataset of roughly 17 million German properties for the period from 2005 to 2019. Our empirical analysis exploits variation in RETT rate hikes across German states and over time. Our monthly event study estimates indicate a price response that strongly exceeds the change in the tax burden for single transactions. Twelve months after a reform, a one percentage point increase in the tax rate reduces property prices by on average 3%. Price effects are larger for apartments (−4%) than for single-family houses (−2%). Exploring potential mechanisms, we provide evidence that different holding periods are the main driver of the differential price effect between property types.</div></div>","PeriodicalId":48340,"journal":{"name":"Journal of Urban Economics","volume":"145 ","pages":"Article 103717"},"PeriodicalIF":5.7000,"publicationDate":"2024-11-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Urban Economics","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0094119024000871","RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ECONOMICS","Score":null,"Total":0}
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Abstract
This paper examines the effects of real estate transfer taxes (RETT) on property prices using a rich micro dataset of roughly 17 million German properties for the period from 2005 to 2019. Our empirical analysis exploits variation in RETT rate hikes across German states and over time. Our monthly event study estimates indicate a price response that strongly exceeds the change in the tax burden for single transactions. Twelve months after a reform, a one percentage point increase in the tax rate reduces property prices by on average 3%. Price effects are larger for apartments (−4%) than for single-family houses (−2%). Exploring potential mechanisms, we provide evidence that different holding periods are the main driver of the differential price effect between property types.
期刊介绍：
The Journal of Urban Economics provides a focal point for the publication of research papers in the rapidly expanding field of urban economics. It publishes papers of great scholarly merit on a wide range of topics and employing a wide range of approaches to urban economics. The Journal welcomes papers that are theoretical or empirical, positive or normative. Although the Journal is not intended to be multidisciplinary, papers by noneconomists are welcome if they are of interest to economists. Brief Notes are also published if they lie within the purview of the Journal and if they contain new information, comment on published work, or new theoretical suggestions.
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