RELIABILITY AND HETEROGENEITY OF REAL ESTATE INDEXES AND THEIR IMPACT ON THE PREDICTABILITY OF RETURNS

  • Francesca Battaglia
  • Claudio Porzio
  • Gabriele Sampagnaro

Abstract

This paper addresses the issue of data quality in the real estate market. In many countries, the returns
indices for direct markets are provided by several sources differing in terms of the methodology adopted and
index weights. These differences produce a lack of informative standardization, which could negatively affect the
ability of market participants to make predictions. Focusing on the Italian real estate market, the aim of this paper
is therefore twofold: to investigate the reliability of property data sources and to assess the impact for financial
intermediaries involved in real estate investing. Our results show a significant level of divergence between the
data, and considerable implications for those financial institutions dealing with them. These findings conflict with
the requirements of an efficient (or at least sub-efficient) market.
Published
2010-12-15
How to Cite
BATTAGLIA, Francesca ; PORZIO, Claudio ; SAMPAGNARO, Gabriele . RELIABILITY AND HETEROGENEITY OF REAL ESTATE INDEXES AND THEIR IMPACT ON THE PREDICTABILITY OF RETURNS. Journal of Advanced Studies in Finance, [S.l.], v. 1, n. 2, p. 188-196, dec. 2010. ISSN 2068-8393. Available at: <https://journals.aserspublishing.eu/jasf/article/view/36>. Date accessed: 05 july 2022.
Section
Journal of Advanced Studies in Finance