Title: Hedonic estimates of the cost of housing services
Description: "Recent papers have questioned the accuracy of the Bureau of Labor Statistics'  methodology for measuring rent increases and changes in implicit rents for  owner-occupied housing.  We compare the BLS estimates of increases in rents and  owner-occupied housing costs to regression-based estimates using data from the  American Housing Survey.  A hedonic approach that explicitly calculates  capitalization rates produces a methodologically consistent measure of the  rental cost of owner-occupied housing.  We estimate that between 1985 and 1999  the Consumer Price Index (CPI-U) may have understated the cumulative increase  in rents.  But any understatement was slight.  On the other hand, we estimate  that the CPI overstated the increase in the cost of housing services for  homeowners by 0.4 percent on an annualized basis from 1985 to 1999"--Federal Reserve Bank of Philadelphia web site.
Subjects: Costs, Housing, Measurement
Places: United States