Abstract:

Globalisation is only the most recent manifestation of convergence theory. This article shows how distinctive housing finance systems in the advanced economies contribute to distinctive housing systems with important social and economic implications. It also suggests that the evidence from the European Union confirms what can be derived from a priori reasoning: that mobility of finance does not alter the nationally based components of the wider housing finance system. Hence, even huge changes in the nature of intermediaries fail to alter the fundamental nature of the mortgage product. Combined with lack of any evidence to suggest that government support for home-ownership is in general or irreversible retreat, it is suggested that the former socialist 'transition' countries have considerably more opportunity to shape their housing finance systems than might be suggested by convergence theory.