Research Discussion Paper – RDP 2014-09 Predicting Dwelling Prices with Consideration of the Sales Mechanism

Contents

• Introduction
• Data and Measurement
• Prediction
• The Persistence of Shocks
• Why Does the Mechanism of Sale Matter?
• Conclusion
• Appendix A: Specification Checks
• Appendix B: A Theoretical Example
• Appendix C: Existence of VECM Representation
• Appendix D: Seller Reserve Prices
• References
• Copyright and Disclaimer Notices

The Discussion Paper series is intended to make the results of the current economic research within the Reserve Bank available to other economists. Its aim is to present preliminary results of research so as to encourage discussion and comment. Views expressed in this paper are those of the authors and not necessarily those of the Reserve Bank. Use of any results from this paper should clearly attribute the work to the authors and not to the Reserve Bank of Australia.

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Our thanks to Alexandra Heath, Matthew Lilley, Adrian Pagan, Peter Tulip and seminar participants at the 2013 American Real Estate and Urban Economics Association Conference for providing helpful comments. The views expressed are the authors and do not necessarily reflect those of the Reserve Bank of Australia or the Hebrew University of Jerusalem.