This paper investigates the forecasting content of real-estate-related stock prices for house prices. Using both in- and out-of-sample tests, this paper shows that real-estate-related stock price indices have extremely robust power in predicting US house prices. The empirical results are highly valuable for investors and policy makers because real-estate-related stock prices are shown to be a reliable predictor reflecting timely market information and are readily available to forecast real estate market movements.
All Science Journal Classification (ASJC) codes
- Economics, Econometrics and Finance(all)