Can list prices accurately capture housing price trends? Insights from extreme markets conditions

Housing matters but measuring housing prices is not straightforward. Using population-level datasets of listings and mortgage drawdowns for the Irish housing market 2006-2012, and a novel decomposition of the gap between the two, I examine whether listings accurately capture sale price trends, even in volatile market conditions. I find that, accounting for time-to-sell, an index based on listed prices is a very accurate barometer of, and lead indicator for, true transaction prices. With current and historical listings readily available online, the findings are very relevant for both academics and policymakers interested in measuring and understanding living costs and wealth trends.