Proposal Description

Monitoring developments of commercial real estate (CRE) markets is of high importance for macroprudential policy. A comprehensive surveillance benefits from shedding light on the multi-faceted nature of CRE markets using various indicators (e.g. prices, rents, rental yields, vacancies) with a sufficient degree of disaggregation. In addition to aggregate headline measures capturing the overall CRE market trend, breakdowns by object types (e.g. office, retail, industry, logistics, multi-family dwellings) and by regions as well as in a prime/non-prime split help policymakers pay due attention to the CRE market-inherent heterogeneity. Progress has been made in developing data sources, advancing statistical methodologies and implementing practical index compilation procedures. Country examples show that it is important to get started, focusing first on those indicators and segments of the CRE market for which enough data is available and sound methods are implementable. Extending the list of indicators, broadening coverage, refining breakdowns etc. are enhancements which may be achieved step by step if more comprehensive data sources become accessible and methodological developments progress further.