Applied Economics Lunch Seminar

Du 18/04/2023 de 12:30 à 13:30

Salle R2.21, Campus Jourdan

MESLIN Olivier ()

How Much is your Home Worth? Estimating Housing Wealth using French Administrative Data.

This paper extends a recent exhaustive database on housing assets owned by French households (Andre and Meslin 2021) by providing estimates of gross housing wealth of French households, based on administrative data. These estimates are obtained in two steps. The market value of all privately-held dwellings located in metropolitan France is estimated using an innovative housing asset valuation methodology. These market value estimates are then combined with the database introduced in Andre and Meslin 2021 to compute gross housing wealth for each household. The asset valuation methodology used in this paper relies on recent machine learning algorithms trained on an exhaustive database of real estate transactions. This methodology reflects accurately the geographical heterogeneity of the real estate markets in metropolitan France and consistently outperforms more traditional econometric approaches (such as hedonic price models). Moreover, we demonstrate that this methodology can reliably be used to estimate housing wealth at both household level and aggregate level. Housing wealth concentration estimates derived from this database are slightly higher than the one derived from wealth surveys. The paper makes three different contributions. First, it highlights several significant methodological contributions of machine learning algorithms compared to more traditional econometric methods. Second, it introduces a new database on housing wealth, opening way to further research. Third, it produces new results on the total amount, distribution and concentration of housing wealth of French households.