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Housing prices don’t take nearly as long to respond to rate hikes as previously thought, according to new research.

A staff working paper from the Bank of Canada — which was authored by researchers from the Bank of Canada, the European Investment Bank and the Federal Reserve Bank of San Francisco — examined data on U.S. residential listings between 2001 and 2019. It found that prices react much more quickly to monetary policy surprises than conventionally thought.

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“Existing literature documents that house prices respond to monetary policy surprises with a significant delay, taking years to reach their peak response. We present new evidence of a much faster response,” it said.

In fact, the researchers found that surprise rate hikes produce a 0.2% to 0.3% drop in listing prices within two weeks, producing a contraction “on par with the effect on stock prices.”

House prices in locations with lower incomes and smaller house values “tend to be more responsive” to policy moves, they noted.

Additionally, they found that the prices houses sell at are mostly determined by their list prices, and that those prices “do not respond independently to monetary policy surprises.”

These new findings on the sensitivity of house prices to monetary shocks has “important implications for the effectiveness of monetary policy to stabilize consumption, income, wealth, prices,” the paper said.