Objectified Housing Sales and Rent Prices in Representative Household Surveys: the Impact on Macroeconomic Statistics

N. Denisa Naidin (), Sofie Waltl and Michael Ziegelmeyer

No 160, BCL working papers from Central Bank of Luxembourg

Abstract: Reliable macroeconomic housing and wealth statistics as well as counterfactual analyses across housing tenure status require hypothetical sales and rent prices for properties off the market reflecting current market conditions and representing the entire housing stock. We replace subjective values reported by participants in the Luxembourg Household Finance and Consumption Survey by objectified values imputed via hedonic models estimated on observable market data. We find that the participants’ tendency to overand under-report values is strongly correlated with tenure length, tenure type, dwelling type, household income and wealth. We find shifts in the wealth distribution, detect large regional variation in price-to-rent, price-to-income and rent-to-income ratios as well as significant affordability concerns: only 18% of all renting households could theoretically afford to purchase the dwelling they currently rent at market conditions. These renters are usually younger, at the top of the wealth and income distribution, and reside outside Luxembourg City.

Keywords: Macroeconomic Statistics; Subjective Assessments; Surveys; Measurement Errors; Housing and Rent Markets; Housing Wealth; Affordability (search for similar items in EconPapers)
JEL-codes: E58 G51 R21 R31 (search for similar items in EconPapers)
Pages: 60 pages
Date: 2022-06
New Economics Papers: this item is included in nep-eur and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Objectified Housing Sales and Rent Prices in Representative Household Surveys: the Impact on Macroeconomic Statistics (2022)
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