The relationship between macroeconomic activity and residential expenditure over the period 1959:I to 1991:I has been examined. The analysis is conducted using varriance decompostions [sic] (VDCs) and historical decompostions [sic] (HDs). The VDCs indicate that shocks to the money stock. Output and interest rates have significant impact on residental [sic] expenditure. The HDs indicate that shocks to macroeconomic variable are relatively unimportant in the determination of residential expenditure in the period following the extensive fiancial [sic] deregulation in the early 1980s.