The well-known example in Malkiel of a chimpanzee throwing darts to select a portfolio that would do as well as the portfolio of an expert displays the notion about the EMH. Put differently, the market is able to absorb the information of yesterday’s price change, without influencing today’s price change, making thus the stock market memory-free. According to EMH, efficient prices reflect all available information, and follow a rather “random walk” where it is impossible to make a profit systematically, or above average return (Fama, ). Moreover, an important discourse in the discussion of the Real Estate market is the relevance of the theory of Efficient Market Hypothesis (EMH). The Real Estate sector, and particularly the housing market under stress has been much less studied compared to other economic assets, and also little is known as far as the information efficiency of Real Estate markets is concerned. More precisely, house prices have tripled in Hong-Kong from 2003 to 2015 while construction surged sharply. The rationale for testing the particular region is that the Hong-Kong housing market could be considered as an ideal laboratory, based on the robust demand for properties, the relatively low interest rates environment for a long period of time and the large and frequent increases in property prices. Real Estate collapse on other housing markets and particularly on Hong-Kong area. The aim of this paper is to investigate the effects of the U.S.

Among the markets, where prices plummeted considerably, were the housing markets and particularly those that historically have exhibited higher volatility. Asset prices across the globe fell, while financial volatility rose substantially. The burst of the housing bubble and the meltdown of the associated prices triggered a chain of reaction to other financial markets, both domestically and internationally. The substantial growth both in mortgage credit and in housing prices initiated an increase in mortgage delinquencies, as interest rates increased sharply. caused an unprecedented international turmoil. The 2007–2008 financial crisis in the U.S.A. Lastly, with the temporal evolution of the indices, we identify periods where the underlying dynamical structure of the market was impacted by certain events like the SARS epidemic and the imposition of Special Stamp Duty on housing. The results are robust based on the utilization of two different entropy definitions: The Shannon and Tsallis-q entropy.

Only the index of the Kowloon area seems not impacted by the crisis, exhibiting higher levels of informational efficiency. The outbreak of the crisis had changed the dynamical structure of the indices decreasing the level of randomness and increasing considerably their regularity and predictability. By calculating the quantifiers we report that most indices exhibit a behavior equivalent to a persistent stochastic dynamics with Hurst exponents between 0.5 and 0.7. Based on permutation entropy, complexity–entropy causality plane and Tsallis complexity–entropy curve, we characterize the complexity of the housing indices-both in terms of size and region-and distinguish the level of informational efficiency. This paper investigates the impact of the sub-prime loan crisis on the Real Estate Market of Hong-Kong.

Monit real estate