Caraiani, PetreGupta, RanganLau, Chi Keung MarcoMarfatia, Hardik A.2022-07-012022-07-012022Petre Caraiani, Rangan Gupta, Chi Keung Marco Lau & Hardik A. Marfatia (2022) Effects of Conventional and Unconventional Monetary Policy Shocks on Housing Prices in the United States: The Role of Sentiment, Journal of Behavioral Finance, 23:3, 241-261, DOI: 10.1080/15427560.2020.1865963.1542-7560 (print)1542-7579 (online)10.1080/15427560.2020.1865963https://repository.up.ac.za/handle/2263/86023In this paper, we use a Quantile Structural Vector Autoregressive (QSVAR) model, estimated over the quarterly period of 1975:Q3 to 2017:Q3, to analyze whether the impact of monetary policy shocks on growth rate of real house price in the United States is contingent on the initial state of housing market sentiment. We find that contractionary monetary policy reduces growth rate of real house price more strongly when the market is characterized by optimism rather than pessimism, with this effect being more pronounced under unconventional monetary policy decisions. Further robustness checks confirm our results. Our findings highlight the role in sentiments in driving the policy effectiveness and thus, have important implications for policy decisions.en© 2021 Taylor and Francis. This is an submitted version of an article published in Journal of Behavioral Finances, vol. 23, no. 3, pp. 241-261, 2022.doi : 10.1080/15427560.2020.1865963. Journal of Behavioral Finance is available online at : https://www.tandfonline.com/loi/hbhf20.House priceMonetary policyHousing sentimentQuantile structural vector autoregressive (QSVAR) modelUnited States (US)Preprint Article