Home Sweet Home How Money Laundering Pollutes the Real Estate Market: An Agent Based Model

The aim of the paper is to analyze the role of real estate market as dirty money laundering channel for organized crime in Italy. We contribute to the economic literature on house price determinants, providing an agent based model to simulate the price determinants in Italian provincial capital. Properties’ prices typically move in tandem with the economy, but not always it happens. An unforeseeable event as Covid-Sars19 pandemic seems not to have influenced the real estate price trend, mainly in house market. As reported by a latest article of the Economist, American house prices rose by 11% in the year to January, the fastest pace for 15 years. Those in Britain increased by 8% last year and in Germany by 9%. In particular, it happens in suburban areas. Some of the rationale for this sudden rise in prices may be the loose monetary policy and governmental measures including support for household incomes, as well as mortgage moratorium, suspension of stamp duty. In this paper, we wonder if the presence of organized crime in a country can influence the price trend for different mortgage interest rate.