House Price Indices ESTP course -MIP Luxembourg 1-3 December 2015 Bogdan Marola Eurostat - Unit C4

Outline House Price Index (HPI) – common concepts and definitions HPI for MIP Dissemination HPI sub-indices for new and existing dwellings Conclusions

HPI – common concepts and definitions (i) HPI measures the price changes of dwellings purchased by households Constant mix and quality – "pure" price changes Transaction prices Price includes VAT for new dwellings Transaction costs (notary, registry/cadastre, agency, bank) excluded

HPI – common concepts and definitions (ii) Index for the price of all (new and existing) dwellings purchased by households: flats, detached houses, terraced houses, etc. independently of their final use independently of previous owners

HPIs for MIP: deflated HPIs “Deflated HPI” - ratio between the HPI and the national accounts deflator for final consumption expenditure (households + NPISH). Final consumption expenditure deflator: implicit index the quarterly data often revised The ‘alarm threshold’ is 6% in the annual rate of change.

HPI data sources and methods Available information will determine compilation methods Sufficient number of transactions needed for reliable indices Eurostat's Handbook on Residential property price indices (2013): http://ec.europa.eu/eurostat/web/hicp/methodology/ housing-price-statistics/residential-property-handbook

HPI quarterly dissemination Launched in 2013 News release on Eurostat home page Database Statistics explained article MIP webpage Data currently available for 29 countries

HPI News Release Every quarter on http://ec.europa.eu/eurostat Chart displaying annual rate of change Table with quarterly and annual rates of change

HPI database On the Eurostat database: http://ec.europa.eu/eurostat/data/database

Statistics Explained Wiki page on Housing Statistics http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Housing_price_statistics_-_house_price_index

MIP webpage

Metadata Available for 29 countries at the Eurostat HPI database

HPI sub-indices for new and existing dwellings In December 2014 Eurostat released: HPI for dwelling categories = new/ existing Item weights (per 1,000) Breakdown currently available for 22 countries Released every quarter at the same time as the total HPI

Conclusions HPIs released by Eurostat are compiled by the EU statistical offices following common concepts and definitions One of the MIP headline indicators Are a comparable measure of house price evolution in EU countries Data and metadata available on Eurostat website

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