This paper aims to test whether capital flows systematically drive the recent rise in housing prices in Colombia. The investigation is done through the lens of the theoretical model in Zanna (1996) and two VEC models, using macroeconomic variables, are estimated. The results from the analysis of impulse response functions and variance decomposition show that there is weak evidence to accept this hypothesis. It is suggested that the internal conditions associated with increased regulation of the mortgage sector are key to explaining why capital flows do not play as active role as they did in the late 90’s. In addition, it is considered that economic fundamentals are the most relevant variables to explain the high values ​​of the residential units in the country for the last time.