EconPapers    
Economics at your fingertips  
 

A New Index of Housing Sentiment

Lasse Bork, Stig V. Møller () and Thomas Pedersen ()
Additional contact information
Stig V. Møller: Aarhus University and CREATES, Postal: Department of Economics and Business Economics, Fuglesangs Allé 4, 8210 Aarhus V, Denmark

CREATES Research Papers from Department of Economics and Business Economics, Aarhus University

Abstract: We propose a new measure for housing sentiment and show that it accurately tracks expectations about future house price growth rates. We construct the housing sentiment index using partial least squares on household survey responses to questions about buying conditions for houses. We ?find that housing sentiment explains a large share of the time-variation in house prices during both boom and bust cycles and it strongly outperforms several macroeconomic variables typically used to forecast house prices.

Keywords: Housing sentiment; house price forecastability; partial least squares; dynamic model averaging (search for similar items in EconPapers)
JEL-codes: C53 E3 G1 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac and nep-ure
Date: 2016-11-11
References: Add references at CitEc
Citations View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
ftp://ftp.econ.au.dk/creates/rp/16/rp16_32.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aah:create:2016-32

Access Statistics for this paper

More papers in CREATES Research Papers from Department of Economics and Business Economics, Aarhus University
Series data maintained by ().

 
Page updated 2017-09-29
Handle: RePEc:aah:create:2016-32