Anja M. Hahn
Vienna University of Economics and Business & DataScience Service GmbH
Sanela Omerovic
Vienna University of Economics and Business & DataScience Service GmbH
Sofie R. Waltl
University of Cambridge & Vienna University of Economics and Business
Abstract
We develop a framework to holistically test for and monitor the impact of different
types of events affecting a country’s housing market, yet originating from housing-
external sources. We classify events along three dimensions leading to testable hypothe-
ses: prices versus quantities, supply versus demand, and immediate versus gradually
evolving. These dimensions translate into guidance about which data type, statistical
measure and testing strategy should be used. To perform such test suitable statistical
models are needed which we implement as a hierarchical hedonic price model and a
complementary count model. These models are amended by regime and contextual
variables as suggested by our classification strategy. We apply this framework to the
Austrian real estate market together with three disruptive events triggered by the
COVID-19 pandemic, a policy tightening mortgage lending standards, as well as the
cost-of-living crisis that came along with increased financing costs. The tests yield the
expected results and, by that, some housing market puzzles are resolved. Deviating
from the prior classification exercise means that some developments would have been
undetected. Further, adopting our framework consistently when performing empiri-
cal research on residential real estate would lead to better comparable research results
and, by that, would allow researchers to draw meta-conclusions from the bulk of studies
available across time and space.
JEL Codes: R21; R31.
Keywords: Countrywide Housing Markets; Testing Framework; Hierarchical Hedonic Price Model; Count Model
This research benefits from funding by the OeNB Anniversary Fund, Research grant No. 18767 (LocHouse). This article uses data by Data Science Services GmbH. The views expressed are solely those of the authors and may not be shared by the data providers.
Dissemination
Working Paper: https://doi.org/10.48550/arXiv.2502.03012
Media Coverage: Wie die Corona-Pandemie Österreichs Immobilienmarkt beeinflusst hat (Die Presse, 8/May/2023, Austria)
Presentations: [1st Workshop on Residential Housing Markets: Perceptions and Measurement, Luxembourg][2022 NOeG Winter Workshop, Vienna][2nd Workshop on Residential Housing Markets – Connecting Housing Researchers in Austria][29th European Real Estate Society (ERES) Annual Conference at University College London][2023 NOeG Annual Meeting at the University of Salzburg][14th Geoffrey J.D. Hewings Regional Economics Workshop at WIFO in Vienna][(LIS)^2ER Workshop on Housing Policy and Wealth Inequality at LIS in Luxembourg][ESCoE Conference on Economic Measurement 2024 in Manchester][4th Workshop on Rent Control and Other Housing Policies in Turin][University of Aberdeen][University of Regensburg][3rd Workshop on Residential Housing Markets: A Market in Distress and Potential Solutions at WU, Vienna]
Sofie R Waltl 