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The determinants of real estate prices in a European context: a four-level analysis

Antonio M. Cunha , Júlio Lobão

ISLA — Instituto Politécnico de Gestão e Tecnologia

Journal of European Real Estate Research, Volume ahead-of-p, Issue ahead-of-p, 22 06 2021

PurposeThis paper explores the real estate price determinants at four geographical levels: in the European Union as a whole, in the 28 European Union countries, in one European Union country (Portugal) and in 25 Portuguese metropolitan statistical areas (MSAs).Design/methodology/approachThe authors run two time series regression models and two panel data regression models with observations of potential real estate price determinants and House Price Indices collected from Eurostat.FindingsThe results show that price determinants, such as gross domestic product (GDP), interest rates, housing starts and tourism, are statistically significant, but not in all the four geographical levels of analysis. The results also confirm the autoregressive characteristic of real estate prices, with the last period price change being the most important determinant of current period real estate price change.Practical implicationsForecasting real estate prices can be made more effective by knowing that each geographical level of analysis implies different price determinants and that momentum is an important determinant in real estate returns.Originality/valueTo the best of the authors knowledge, this is the first study to develop and test a real estate price equilibrium model at several different geographical levels of the same political space.

Keywords

#real estate prices #determinants of housing prices #housing price index #European Union #portugal #metropolitan statistical areas #gross domestic product #Interest rates #housing starts #Tourism #price momentum #real estate price forecasting #multilevel analysis #Real estate #Economics #Context (archaeology) #Price index #Real estate investment trust #Econometrics #Metropolitan area #Renting

Bibliographic Details

Publication Type Journal article

Publication Year 2021

Journal / Conference / Work Journal of European Real Estate Research

Volume / Issue Vol. ahead-of-p (ahead-of-p)

Quartile (SCImago) Q2

Scopus Indexing Indexed source (via SCImago)

ISLA Authors & Affiliations

The determinants of real estate prices in a European context: a four-level analysis

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Bibliographic Details

ISLA Authors & Affiliations