Journal Article

Forecasting real housing price growth in the Eighth District states

Abstract: The authors consider forecasting real housing price growth for the individual states of the Federal Reserve's Eighth District. They first analyze the forecasting ability of a large number of potential predictors of state real housing price growth using an autoregressive distributed lag (ARDL) model framework. A number of variables, including the state housing price-to-income ratio, state unemployment rate, and national inflation rate, appear to provide information that is useful for forecasting real housing price growth in many Eighth District states. Given that it is typically difficult to determine a priori the particular variable or small set of variables that are the most relevant for forecasting real housing price growth for a given state and time period, the authors also consider various methods for combining the individual ARDL model forecasts. They find that combination forecasts are quite helpful in generating accurate forecasts of real housing price growth in the individual Eighth District states.

Keywords: Housing - Prices; Federal Reserve District, 8th;

Status: Published in The Third Annual Conference of the Business & Economics Research Group (BERG), in St. Louis, June 2007.

Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Regional Economic Development

Publication Date: 2007

Issue: Nov

Pages: 33-42