REINZ house price index gets makeover
The REINZ series has "higher peaks and lower troughs" in periods of extreme turnover, both high and low, compared to the more accurate QV Valuation measure, with "sales volumes on cheaper property more cyclical," according to a Reserve Bank discussion paper on the development of stratified housing price measures.
Stratification is where suburbs are given weightings relative to the median price of sale to create an index to more genuinely reflect property price movements.
"By using detailed sale price information collected by REINZ, the bank has developed a housing price measure that provides a timely and regular reading of housing price movements," said central bank Assistant Governor John McDermott in a statement.
"Obtaining timely signals on housing prices (is) important for analysis of the New Zealand economy."
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