- Inflation protection from homeownership: Long-run evidence 1814-2008
- Real Estate Economics
- Volume | Issue number
- 42 | 3
- Pages (from-to)
- Document type
- Faculty of Economics and Business (FEB)
- Amsterdam Business School Research Institute (ABS-RI)
This article examines the inflation hedging capacity of the private home. We employ unique long-term data for inflation, house price dynamics and rents for Amsterdam dating back to 1814, allowing us to study total housing returns in different inflation regimes and for varying investment horizons. Our Amsterdam data show that homeownership’s protection against actual and expected inflation
increases with the investment horizon. This increase is especially strong for horizons up to 10 years. Inflation protection from housing is stronger when inflation is persistent, and the hedging capacities of housing regarding unexpected inflation are weak.
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