Prior to World War II in the 20th century, the real estate market in various European and American countries were dominated by house leasing and tenancy. After World War II, the purchase of houses was on rise and gradually became the predominant trade form in the market. However, nowadays tenancy and selling of houses still co-exist in the market in these countries.
This imposes important tradeoffs for emerging markets’ central banks, as higher cross-border financial integration has amplified emerging economies’ exposure to developments in global markets. In spite of that, experience shows that the benefits that are inherent to a higher global financial integration outweigh the costs.