Prices of Residential Property in Italy: Constructing a New Indicator

34 Pages Posted: 21 Oct 2008

Date Written: August 18, 2008

Abstract

We present a new indicator of house prices in Italy, with more extensive geographical and time coverage. The new indicator now makes it possible to analyze medium- and long-term trends with satisfactory representation of the Italian housing market. It also allows for timely updating, for prompt assessment of housing input both to the business cycle and to inflationary pressures. We offer a preliminary identification, based solely on graphical inspection, of four different property price cycles since the late 1960s; the latest began at the end of the 1990s and signaled a slowdown since 2006. Finally, we tentatively assess the effect of including transactions in dwellings in the Italian HICP basket according to the net acquisition approach, which apparently results in about a quarter point of additional inflation each year since 2000.

Keywords: business cycle, housing market, property prices, inflation measures

JEL Classification: E31, E32, R21, R31

Suggested Citation

Muzzicato, Salvatore and Sabbatini, Roberto and Zollino, Francesco, Prices of Residential Property in Italy: Constructing a New Indicator (August 18, 2008). Bank of Italy Occasional Paper No. 17, Available at SSRN: https://ssrn.com/abstract=1287629 or http://dx.doi.org/10.2139/ssrn.1287629

Salvatore Muzzicato

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Roberto Sabbatini (Contact Author)

Bank of Italy ( email )

Via Nazionale 91
00184 Roma
Italy

Francesco Zollino

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

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