IDEAS home Printed from https://ideas.repec.org/p/hnb/wpaper/19.html
   My bibliography  Save this paper

Use of the Hedonic Method to Calculate an Index of Real Estate Prices in Croatia

Author

Listed:
  • Davor Kunovac

    (The Croatian National Bank, Croatia)

  • Enes Đozović

    (The Croatian National Bank, Croatia)

  • Gorana Lukinić

    (The Croatian National Bank, Croatia)

  • Andreja Pufnik

    (The Croatian National Bank, Croatia)

Abstract

Due to the significant impact that real estate prices may have on overall economic developments, it is necessary to create a reliable index for monitoring the movements of real estate prices. This paper presents the hedonic method, which enables the creation of a real estate price index that in addition to the price takes into account the characteristics of real estate and provides for the estimation of pure change in the price of residential real estate between two points in time. This paper also strives to answer several interesting questions such as: has the sharp increase of real estate prices resulted in the purchase of smaller dwellings, how has the growth of real estate prices affected real demand for housing loans and can databases containing the asking prices of real estate be used to create a reliable real estate price index? This paper also indicates the possibility of the estimated regression model being used in the creation of an expert system for assessment of real estate prices of known characteristics.

Suggested Citation

  • Davor Kunovac & Enes Đozović & Gorana Lukinić & Andreja Pufnik, 2008. "Use of the Hedonic Method to Calculate an Index of Real Estate Prices in Croatia," Working Papers 19, The Croatian National Bank, Croatia.
    • Handle: RePEc:hnb:wpaper:19
    as

    Download full text from publisher

    File URL: http://www.hnb.hr/repec/hnb/wpaper/pdf/w-019.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jenny N. Lye & Joseph G. Hirschberg, 2002. "Tests of Inference for Dummy Variables in Regressions with Logarithmic Transformed Dependent Variables," Department of Economics - Working Papers Series 852, The University of Melbourne.
    2. Olympia Bover & Pilar Velilla, 2001. "Hedonic house prices without characteristics: the case of new multiunit housing," Estudios Económicos, Banco de España, number 73.
    3. Dubravko Mihaljek, 2005. "Free movement of capital, the real estate market and tourism: a blessing or a curse for Croatia on its way to the European Union?," Chapters in books, in: Katarina Ott (ed.), Croatian Accession to the European Union: Facing the Challenges of Negotiations, volume 3, chapter 8, pages 185-228, Institute of Public Finance.
    4. David Rae & Paul van den Noord, 2006. "Ireland's Housing Boom: What has Driven it and Have Prices Overshot?," OECD Economics Department Working Papers 492, OECD Publishing.
    5. Melser, Daniel, 2005. "The Hedonic Regression Time-Dummy Method and the Monotonicity Axioms," Journal of Business & Economic Statistics, American Statistical Association, vol. 23, pages 485-492, October.
    6. Brent R. Moulton, 2001. "The Expanding Role of Hedonic Methods in the Official Statistics of the United States," BEA Papers 0018, Bureau of Economic Analysis.
    7. Gouriéroux, Christian & Laferrère, Anne, 2009. "Managing hedonic housing price indexes: The French experience," Journal of Housing Economics, Elsevier, vol. 18(3), pages 206-213, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Adrienne Mack & Enrique Martínez García, 2011. "A cross-country quarterly database of real house prices: a methodological note," Globalization Institute Working Papers 99, Federal Reserve Bank of Dallas.
    2. Galinec Davor & Vuglar Jadranka & Cvrtila Dario, 2019. "Residential property price index in Croatia: from experimental to official statistics," Croatian Review of Economic, Business and Social Statistics, Sciendo, vol. 5(1), pages 33-42, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Haug, Peter (Ed.) & Rosenfeld, Martin T. W. (Ed.) & Weiß, Dominik (Ed.), 2012. "Zur Zukunft der kommunalen Wohnungspolitik in Deutschland und Europa. Tagungsband: Referate und Diskussionen im Rahmen des 3. Halleschen Kolloquiums zur Kommunalen Wirtschaft am 5. und 6. November 200," IWH-Sonderhefte 3/2012, Halle Institute for Economic Research (IWH).
    2. Andreja Benkovic & Juan Felipe Mejía, 2008. "Tourism as a driver of economic development: The Colombian experience," Documentos de Trabajo de Valor Público 10630, Universidad EAFIT.
    3. Catalina Juaneda & Josep Maria Raya & Francesc Sastre, 2011. "Pricing the Time and Location of a Stay at a Hotel or Apartment," Tourism Economics, , vol. 17(2), pages 321-338, April.
    4. Carol Corrado & Mary O'Mahony & Lea Samek, 2020. "Measuring education services using lifetime incomes," Economic Statistics Centre of Excellence (ESCoE) Discussion Papers ESCoE DP-2020-02, Economic Statistics Centre of Excellence (ESCoE).
    5. Masron, tajul & Mohd Nor, Abu Hassan Shaari, 2016. "Foreign Investment in Real Estate and Housing Affordability," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 50(1), pages 15-28.
    6. Linnea Polgreen & Pedro Silos, 2008. "Capital-Skill Complementarity and Inequality: A Sensitivity Analysis," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(2), pages 302-313, April.
    7. Stanley A. Horowitz & Bruce R. Harmon & Daniel B. Levine, 2016. "Inflation adjustments for defense acquisition," Defence and Peace Economics, Taylor & Francis Journals, vol. 27(2), pages 231-257, April.
    8. Robert C. Feenstra & Christopher R. Knittel, 2009. "Reassessing the US Quality Adjustment to Computer Prices: The Role of Durability and Changing Software," NBER Chapters, in: Price Index Concepts and Measurement, pages 129-160, National Bureau of Economic Research, Inc.
    9. Iulia Siedschlag, 2008. "Macroeconomic Differentials and Adjustment in the Euro Area," SUERF Studies, SUERF - The European Money and Finance Forum, number 2008/3 edited by Morten Balling, May.
    10. Bocart, Fabian & Hafner, Christian, 2012. "Volatility of price indices for heterogeneous goods," LIDAM Discussion Papers ISBA 2012019, Université catholique de Louvain, Institute of Statistics, Biostatistics and Actuarial Sciences (ISBA).
    11. Perambur S. Neelakanta & Aziz U. Noori, 2021. "Techno-economic price-worthiness of mobile networks: a hedonic heuristic perspective," Netnomics, Springer, vol. 22(2), pages 85-113, December.
    12. Ahrend, Rudiger, 2010. "Monetary ease: A factor behind financial crises? Some evidence from OECD countries," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 4, pages 1-30.
    13. Brachinger, Hans Wolfgang, 2002. "Statistical Theory of Hedonic Price Indices," DQE Working Papers 1, Department of Quantitative Economics, University of Freiburg/Fribourg Switzerland, revised Aug 2003.
    14. Mundaca, Fernando & Sánchez, Elmer, 2018. "Índice de precios de inmuebles: Un enfoque hedónico," Revista Estudios Económicos, Banco Central de Reserva del Perú, issue 36, pages 55-74.
    15. Jesús Fernández-Villaverde & Luis Garicano & Tano Santos, 2013. "Political Credit Cycles: The Case of the Eurozone," Journal of Economic Perspectives, American Economic Association, vol. 27(3), pages 145-166, Summer.
    16. Arnab Bhattacharjee & Eduardo Castro & Taps Maiti & João Marques, 2014. "Endogenous spatial structure and delineation of submarkets: A new framework with application to housing markets," SEEC Discussion Papers 1403, Spatial Economics and Econometrics Centre, Heriot Watt University.
    17. Karol Jan Borowiecki, 2009. "The Determinants of House Prices and Construction: An Empirical Investigation of the Swiss Housing Economy," International Real Estate Review, Global Social Science Institute, vol. 12(3), pages 193-220.
    18. Comin Diego A, 2006. "Using Investment Data to Assess the Importance of Price Mismeasurement," The B.E. Journal of Macroeconomics, De Gruyter, vol. 6(1), pages 1-42, April.
    19. Jose Torres-Pruñonosa & Pablo García-Estévez & Josep Maria Raya & Camilo Prado-Román, 2022. "How on Earth Did Spanish Banking Sell the Housing Stock?," SAGE Open, , vol. 12(1), pages 21582440221, March.
    20. David Byrne & David Duffy & John FitzGerald, 2018. "Household Formation and Tenure Choice: Did the Great Irish Housing Bust Alter Consumer Behaviour?," The Economic and Social Review, Economic and Social Studies, vol. 49(3), pages 287-317.

    More about this item

    Keywords

    hedonic index; real estate price index; real estate market;
    All these keywords.

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hnb:wpaper:19. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Romana Sinković (email available below). General contact details of provider: https://www.hnb.hr .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.