Hedging Housing Risk

摘要: An unusually rich source of data on housing prices in Stockholm is used to analyze the investment implications choices. This empirical analysis derives market-wide price and return series for during a 13-year period, it also provides estimates individual-specific, idiosyncratic, variation returns. Because idiosyncratic component follows an autocorrelated process, portfolio choice dependent upon holding period. We composition household portfolios containing housing, common stocks, stocks real estate companies, bonds, t-bills. For short periods, efficient contains essentially no housing. longer low-risk contain 15 50 percent These results suggest that there are large potential gains from policies or institutions would permit households hedge their lumpy investments estimate value hedges reducing risk households, yet yielding same The surprisingly large, especially poorer homeowners.