Reaching for yield and the housing market: Evidence from 18th-century Amsterdam
New paper by Matthijs Korevaar explores the links between financial markets and real estate in 18th-century Amsterdam
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Tulip mania
An update from the garden: Tulips tulips tulips
Professor!
Personal news: I have been elected Grosvenor Professor of Real Estate Finance at the University of Cambridge
Franz Xaver Rektorzik
Etchings by Franz Xaver Rektorzik, printed by August Potuczek
New paper: Testing machine learning systems in real estate
How do ML-models arrive at their predictions? Do they do what we hope they do—or are corners cut?. New paper out at Real Estate Economics
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New Paper: Urban land valuation with bundled good and land residual assumptions
Paper out: This paper develops a new approach to estimate the value of urban land and indirectly tests land residual assumptions. Bonus: Value surfaces estimated with a spatial ANN.
New Working Paper: “Growth and Predictability of Urban Housing Rents”
This paper studies urban rental prices for half a millennium (1500–2020) and seven cities: Amsterdam, Antwerp, Bruges, Brussels, Ghent, London, and Paris. Based on a dataset of 436,000 rental cash flow observations, we build continuous annual indices of housing rents, which we employ to study the long-term developments in rental cash flows, as well as their predictability. We find that real rent growth has been limited, but with large differences across cities: average annual growth rates range between 0.12 percent for the Belgian cities to 0.30 percent for Paris. At the market level, we show that sluggish supply adjustment implies that past population growth negatively predicts current rental growth. At the individual asset level, we find that past excess rental growth rates are predictive of future rent revisions, and that increasing steepness of the term structure of contract rents is predictive for future rent levels.
Spatial ML: Estimating Land Values in Phoenix (AZ)?
A neural networks that accounts for spatial correlation and time dynamics?
Are Estimates of Rapid Growth in Urban Land Values an Artifact of the Land Residual Model?
New paper out: A closer look at urban land and structure values – this is important for national accounts and for analysis of real estate risk over time. With John Clapp and Jeff Cohen.
