Predicting turning points in the housing market

Roberto M. Croce and Donald Haurin

Journal of Housing Economics, 2009, vol. 18, issue 4, 281-293

Abstract: We identify leading indicators of changes in the housing market and compare their performance in predicting turning points. Being able to predict turning points is of importance to the home building industry, homeowners, and makers of housing policy. Our leading indicators include the Wells Fargo/NAHB Housing Market Index, two of its forward looking components, and an index of consumer sentiment regarding purchasing a home. Our comparison tests include Granger causality and a Bayesian predictor of the probability of a turning point. We find that the measure of consumer sentiment performs relatively well compared to the HMI in predicting home permits, housing starts, and new home sales.

Keywords: R31; R21; C53; E37; Forecasting; Housing; starts; Building; permits; Home; sales; Turning; points (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (18)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:18:y:2009:i:4:p:281-293

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