Download The 12th OECD-NBS Workshop on National Accounts Real Value

The 12th OECD-NBS Workshop on
National Accounts
Real Value-added Estimation of Real Estate (LIU Nan, NBS)
Comments on paper by Roger Jullion, Statistics Canada
October 2008
Real value-added estimation of Real Estate
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Measuring housing services in national accounts
NBS estimates of nominal output
NBS estimates of real output
Methods used at Statistics Canada
Suggestions for further development
Statistics Canada • Statistique Canada
2017-05-23
Measuring housing services in national
accounts
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Rented vs owner-occupied housing
Production-based and expenditure-based GDP
Rental equivalence approach
User cost approach
Statistics Canada • Statistique Canada
2017-05-23
Owner-occupied housing services
 NBS adopted user cost approach
• Data problems with rental equivalence approach
 Nominal output equal to:
• Repair and maintenance costs
• Plus: management fees
• Plus: depreciation
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Statistics Canada • Statistique Canada
2017-05-23
Owner-occupied housing services
 Suggested improvements to nominal series
• Include property taxes (could be available from
municipal records)
• Include interest on housing loans (could be available
from bank reports)
• Include housing insurance
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Statistics Canada • Statistique Canada
2017-05-23
Constant price estimates of owner-occupied
housing services
 Nominal owner occupied rents deflated by NBS
using the renting price index
• Problems of consistency between nominal series and
the deflator
• Coverage of renting price index limited to large cities
• Earlier methodological notes suggested that the
construction and installation price index was used as
a deflator for repair and maintenance and
management fees
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Statistics Canada • Statistique Canada
2017-05-23
Constant price estimates of owner-occupied
housing services
 Alternative approach proposed by NBS
• Uses a volume indicator based on the growth rate of
urban and rural occupied housing area
• The housing area projector would exclude
improvements made to the dwellings that do not
increase the housing area but improve the quality of
the dwelling
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Statistics Canada • Statistique Canada
2017-05-23
Method used by Statistics Canada
 Rental equivalence approach used for owner-occupied
dwellings (estimates done by province)
 Adjustments are made for quality changes e.g. size of
the dwellings (based on Census information)
 Volume estimates for housing services for tenant
occupied and owner-occupied housing are based on the
growth of the constant price housing stock
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Statistics Canada • Statistique Canada
2017-05-23
Suggestions for improvement
 If the user cost approach is continued, the nominal
estimates should be increased to include property taxes,
interest on housing loans and home insurance
 Consideration could be given to using the constant price
housing stock derived from the PIM model as a volume
indicator for housing services for both rented dwellings
and owner-occupied dwellings
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Statistics Canada • Statistique Canada
2017-05-23