If the general level of house prices falls a long way, policymakers may introduce new policies which seek to support prices. This paper considers the effect of such interventions on the valuation of no-negative-equity guarantees (NNEG) in equity release mortgages. I model interventions by a reflecting barrier expressed as a fraction of the current level of house prices. Reflection at the barrier is instantaneous, so the no-arbitrage property is preserved, and hence risk-neutral valuation of NNEG is possible. The reflecting barrier can alternatively be justified as a representation of the different economic nature of the underlying housing (and particularly freehold land) assets in NNEG valuations, compared with the underlying equity assets in many other option valuations.

中文翻译：

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具有较低反映壁垒的无负资产担保估值

如果房价总体水平大幅下跌，政策制定者可能会推出新的政策来支持房价。本文考虑了此类干预对股权释放抵押贷款中无负股权担保 (NNEG) 估值的影响。我通过反映障碍对干预进行建模，表示为当前房价水平的一小部分。障碍处的反射是瞬时的，因此保留了无套利属性，因此可以对 NNEG 进行风险中性估值。与许多其他期权估值中的标的股权资产相比，反射障碍也可以证明 NNEG 估值中标的住房（尤其是永久产权土地）资产的不同经济性质。