Predicting turning points in the housing market
AbstractWe identify leading indicators of changes in the housing market and compare their performance in predicting turning points. Being able to predict turning points is of importance to the home building industry, homeowners, and makers of housing policy. Our leading indicators include the Wells Fargo/NAHB Housing Market Index, two of its forward looking components, and an index of consumer sentiment regarding purchasing a home. Our comparison tests include Granger causality and a Bayesian predictor of the probability of a turning point. We find that the measure of consumer sentiment performs relatively well compared to the HMI in predicting home permits, housing starts, and new home sales.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Housing Economics.
Volume (Year): 18 (2009)
Issue (Month): 4 (December)
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Web page: http://www.elsevier.com/locate/inca/622881
R31 R21 C53 E37 Forecasting Housing starts Building permits Home sales Turning points;
Find related papers by JEL classification:
- R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Production Analysis, and Firm Location - - - Housing Supply and Markets
- R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
- C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
- E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
- For - International Economics - - - - -
- Hou - Public Economics - - - - -
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- Bui - Schools of Economic Thought and Methodology - - - - -
- per - - - - - -
- Hom - Public Economics - - - - -
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