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Hedonic Indexes for Public and Private Housing in Costa Rica

Author

Listed:
  • Porfirio Guevara

    () (University of Graz)

  • Robert J. Hill

    () (University of Graz)

  • Michael Scholz

    () (University of Graz)

Abstract

We present the first hedonic house price indexes for Costa Rica at the national and provincial level, and for both the public and private sectors. Our indexes, which focus on building costs, show that the real quality-adjusted price of new residential structures rose by 10 percent over the period 2000-2013. Important differences emerge when we compare the public and private sectors. The average quality of private housing rose strongly during our sample period, while the average quality of public housing fell. Recipients of public housing therefore became worse off. The fall in quality was matched by a fall in price in the public sector, and hence generated cost savings for the government. Also, by estimating separate hedonic models for the public and private sectors, we show that public sector housing would not be produced more cheaply in the private sector. In this sense the public sector seems quite efficient.

Suggested Citation

  • Porfirio Guevara & Robert J. Hill & Michael Scholz, 2015. "Hedonic Indexes for Public and Private Housing in Costa Rica," Graz Economics Papers 2015-05, University of Graz, Department of Economics.
  • Handle: RePEc:grz:wpaper:2015-05
    as

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    File URL: http://www100.uni-graz.at/vwlwww/forschung/RePEc/wpaper/2015-05.pdf
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    References listed on IDEAS

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    1. Gonzales Arrieta, Gerardo M., 2005. "Mortgage loans and access to housing for low-income households in Latin America," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    2. Luis M. Cubeddu & Camilo E Tovar Mora & Evridiki Tsounta, 2012. "Latin America; Vulnerabilities Under Construction?," IMF Working Papers 12/193, International Monetary Fund.
    3. Robert J. Hill, 2013. "Hedonic Price Indexes For Residential Housing: A Survey, Evaluation And Taxonomy," Journal of Economic Surveys, Wiley Blackwell, vol. 27(5), pages 879-914, December.
    4. Francisco Sancho & Luis Rivera & Julio Rosales, 2012. "Housing Finance in Central America: What is Holding It Back?," Research Department Publications 4761, Inter-American Development Bank, Research Department.
    5. Eduardo Lora & Andrew Powell, 2011. "A New Way of Monitoring the Quality of Urban Life," Research Department Publications 4729, Inter-American Development Bank, Research Department.
    6. Eurostat, 2013. "Handbook on Residential Property Prices Indices," World Bank Publications, The World Bank, number 17280, June.
    7. Jing Wu & Yongheng Deng & Hongyu Liu, 2014. "House Price Index Construction in the Nascent Housing Market: The Case of China," The Journal of Real Estate Finance and Economics, Springer, vol. 48(3), pages 522-545, April.
    8. Eduardo Lora & Andrew Powell, 2011. "A New Way of Monitoring the Quality of Urban Life," WIDER Working Paper Series 012, World Institute for Development Economic Research (UNU-WIDER).
    9. Diewert, Erwin, 2011. "Alternative Approaches to Measuring House Price Inflation," Economics working papers erwin_diewert-2011-1, Vancouver School of Economics, revised 07 Jan 2011.
    10. Roger Madrigal & Juan Robalino & Luis J. Hall, 2008. "Quality of Life in Urban Neighborhoods in Costa Rica," Research Department Publications 3263, Inter-American Development Bank, Research Department.
    11. Mario Cuevas & Sigfrido Lee & Maria Isabel Bonilla, 2011. "The Missing Foundations of Housing Finance: Incomplete Markets, Fragmented Policies and Emerging Solutions in Guatemala," Research Department Publications 4750, Inter-American Development Bank, Research Department.
    12. repec:idb:brikps:65338 is not listed on IDEAS
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    Keywords

    Housing market; Hedonic index; Quality change; Public housing;

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