House Prices in Europe - Indicator Development and Figures

When the crisis occurred the existing sets of national house price indices (HPIs) were often based on private sources outside official statistics. These indicators could differ widely, in particular with respect to the type of price data, coverage and quality adjustment. Due to sustained efforts from Eurostat and the National Statistical Institutes (NSIs), the situation has dramatically improved since then.Building on a pilot project launched in early 2000’s to develop price indices for Owner Occupied Housing, Eurostat and the NSIs released the first experimental HPIs at the end of 2010. After a period of consolidation in 2011-2012, the official harmonised HPIs were released in the beginning of 2013. The quarterly data started in 2005.Official European statistics need to abide to the highest standards of quality and harmonisation across countries. To arrive at this level, the most important issue has been the availability of data on the price of the transactions. A second key challenge has been associating the price to the dwelling characteristics. A third key challenge has been the quality adjustment from one time period to the next.The European project produced an international Handbook on Residential Property Price Indices complemented by practical guidelines for the compilation of harmonised HPIs. A reference legal framework has been set up targeting the years to come without any obligation to provide back data.Today HPIs published by Eurostat are used for several policy purposes: for monetary policy, for financial stability and also to monitor macroeconomic imbalances in EU Member States: The development of real house prices (nominal HPI deflated by the final consumption deflator) is one of the eleven MIP Scoreboard indicators used in the European Semester Monitoring.While the policy uses rely mainly on a swift dissemination of current data, the analysis of the housing market requires also longer data series. Eurostat has been working on this issue and today it is possible to disseminate longer data for most EU countries going back to 2000.This longer series have the advantage that, in addition to the post-crisis period, they capture the pre-crisis period. Moreover, they are available in one place for all EU countries on the Eurostat website.The publication of HPIs for EU countries going back to 2000 offers thus a reliable and easy-to-use source of data for those interested in better understanding the evolution of housing markets.