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Tracking Home-Owners’ Sentiments: Subjective Indices and Convergent Validity

Published version
Peer-reviewed

Repository DOI


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Abstract

jats:titleAbstract</jats:title>jats:pSurveys regularly ask home-owners to guess what their property might be worth in the current housing market. We develop suitable statistical techniques to construct hedonic and repeat-sales style house price indices from these owner-estimated values (OEVs). The resulting series are then linked to a large set of quality-adjusted residential property price indices estimated from transaction data allowing us to perform a variety of convergent validity tests. Based on results for 20 countries, several decades and different OEV elicitation techniques, we conclude that thejats:italic“wisdom of the home-owner crowd”</jats:italic>is sufficient to study objective house price dynamics. Yet, surveys fail to accurately measure house price levels.</jats:p>

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Keywords

Housing markets, Subjective data, Convergent validity, House price indices

Journal Title

Journal of Real Estate Finance and Economics

Conference Name

Journal ISSN

0895-5638
1573-045X

Volume Title

Publisher

Springer Science and Business Media LLC