Objectified Housing Sales and Rent Prices in Representative Household Surveys: the Impact on Macroeconomic Statistics

M. Denisa Naidin
Luxembourg Institute of Socio-Economic Research (LISER) & University of Luxembourg

Sofie R. Waltl
Luxembourg Institute of Socio-Economic Research (LISER) & Vienna University of Economics and Business

Michael H. Ziegelmeyer
Banque centrale du Luxembourg (BCL) & Munich Center for the Economics of Aging (MEA)


Reliable macro-economic housing and wealth statistics as well as counterfactual analyses across housing tenure status require hypothetical sales and rent price estimates reflecting current market conditions and representing the housing stock. We replace subjectively estimated values by participants in the Luxembourg Household Finance and Consumption Survey by objectified values imputed via hedonic models estimated on observable market transactions. We characterise survey participants who tend to under- or over-report, respectively, and find strong correlations with tenure length, tenure type, type of dwelling, as well as household income and wealth. We find structural shifts in the wealth distribution, detect large regional variation in price-to-rent, price-to-income and rent-to-income ratios as well as stark affordability concerns: only 15% of all renting households could theoretically afford and would economically benefit from purchasing their inhabited dwelling given current market conditions. Renters that could afford such a purchase are typically below 35, placed at the top of the wealth and income distribution and reside outside of Luxembourg City.

JEL Codes: E58; G51; R21; R31.
Keywords: Macroeconomic Statistics; Subjective Assessments; Surveys; Measurement Errors; Housing and Rent Markets; Affordability; Housing Wealth.

This research benefits from funding by the FNR Luxembourg National Research Fund, CORE Grant No. 3886 (ASSESS). This article uses data from the Luxembourg Observatoire de l’Habitat and the Luxembourg Household Finance and Consumption Survey. The views expressed are solely those of the authors and may not be shared by the data providers nor the BCL or the Eurosystem.


Poster: [ASSA 2022]

Working Paper: Naidin, M. D., Waltl, S. R., & Ziegelmeyer, M. H. (2022). Objectified Housing Sales and Rent Prices in Representative Household Surveys: the Impact on Macroeconomic Statistics. LISER Working Papers 2022-03.

Presentations (incl. scheduled): [National Bank of Slovakia Research Webinar][2021 Economic Statistics Centre of Excellence (ESCoE) Conference on Economic Measurement][European Central Bank (DG Statistics)][Banque centrale du Luxembourg][2021 User workshop of the Eurosystem Household Finance and Consumption Survey, European Central Bank][Meeting of the Expert Group on Distributional Financial Accounts][2022 ASSA Virtual Annual Meeting][2022 LISER seminar][2022 Austrian and Slovenian Statistical Days at TU Graz][37th General Conference of the International Association for Research in Income and Wealth, STATEC, Luxembourg]