The analysis in this article reveals that the natural vacancy rate is a reliable indicator of the market's equilibrium vacancy rate, and a type of market trigger that can be used to forecast changes in future rental rates.
Rental Housing Markets and the Natural Vacancy Rate.
However, most equilibrium models of frictional unemployment (21) suggest that the natural vacancy rate increases when the Beveridge curve shifts out.
Secondly, even if it were persistent, the shift at the current level of the job openings rate is higher than at any plausible new natural vacancy rate.
Conceptually, the natural vacancy rate (NVR) is that which corresponds with market equilibrium and rent stability.
This article formally estimates the natural vacancy rate for Dublin's office market using an econometric approach.
The long-run natural vacancy rate is the vacancy rate at which rents will be neither rising nor falling.
Smith, "The Price-Adjustment Process for Rental Housing and Natural Vacancy Rate," American Economic Review, 85:4, September 1983, 779-786.
Constants): [Beta] is an agent intertemporal discount factor, Vn = natural vacancy rate, assumed to be fixed at 5 percent.
The Price Adjustment Process for Rental Housing and the Natural Vacancy Rate, AER, September, pp.
In recent studies, Wheaton and Torto|24~ and Voith and Crone|21~ examine office rent changes and the natural vacancy rate
Dunning, Natural vacancy rates
in Canadian urban centres, Will Dunning Inc.