Prices and Constant Quality Price Indexes for Multi-Dwelling and Commercial Buildings in Sweden

The purpose of this paper is to estimate constant quality price trends and analysing factors determining market prices for MDCBs (multi-dwelling and commercial buildings) in Sweden. We use high quality data for housing and municipality attributes and our database consists of almost 8500 observations from the second half of 1995 to the end of 1998. Our econometric test indicates that standard housing and municipality attributes are important determinants to sales prices. We have also employed spatial econometric techniqes and have found that spatial specified regressions improved the explanatory power for the models. The estimated constant quality appreciation rates for all MDCBs differ significantly from those reported by Statistics Sweden. When the constant quality price trend is estimated on a yearly basis there are hardly any differences among the estimated parameters whether all MDCBs are in the sample or if the sample is split up into submarkets. However, estimating quarterly constant quality price trends gives another picture.