Aggregation Bias on Residential Property Price Indexes: Hedonic Measurement vs. Repeat Sales Measurement

Chihiro Shimizu and Koji Karato

Economic Review, 2015, vol. 66, issue 3, 209-223

Abstract: Property has the particularity of being a non-homogeneous good, and based on this, it is necessary to perform quality adjustment when estimating property price indexes. Various methods of quality adjustment have been proposed and applied, such as the hedonic method often used in price statistics and, due to the fact that the information that can be used in estimation is limited, the repeat sales price method, methods using property appraisal price information, and so forth. However, since there is a lack of theoretical knowledge and data restrictions, it is no exaggeration to say that it is difficult to evaluate their practical application in the present situation. We summarized theoretical background of property price indexes and used a unique dataset that we had compiled from individual listings in a widely circulated real estate advertisement magazine.

JEL-codes: C2 C23 C43 D12 E31 R21 (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:hit:ecorev:v:66:y:2015:i:3:p:209-223

DOI: 10.15057/27517

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