[OPE-L] How the imputed rental value of owner-occupied housing can boost GDP

[Jurriaan Bendien <adsl675281@xxxxxxxxxx>]

The imputation of "value added" by the owner-occupied housing "service"
differs between countries, because of differences in housing market
structures and the availability of source data.

I do not know what method the NIPAs use (possibly it is discussed in Survey
of Current Business), but insofar as the "net output" of the housing sector
includes "consumption of fixed capital" on the product side of the account,
the data must refer to the market value of housing assets.

UNSNA values own-account housing "services" using data on the same kinds of
services sold on the market (the so-called  rental equivalence approach).
Similarly, the EU Commission Decision of 18 July 1995 specified principles
to estimate dwelling "services" in EU countries, and describes the specific
guidelines of the estimation in the annex. (95/309/EC, Euratom).  The
Commission recommended that, for the benchmark year estimates, member
countries adopt a stratification method, breaking down the total housing
stock into various strata to acquire the information on actual rentals paid
in each stratum, and then using actual rentals data  for compiling the
imputed rentals of owner occupied dwellings. Stratification criteria of
dwellings, and special estimation problems such as rent-free and second home
etc. are also discussed. In case of rent-free and cheap dwelling, the
difference between the actual and referential rental is treated as
"remuneration in kind". Estimates for years other than a benchmark year are
estimated by extrapolating the base year figures using appropriate quantity,
price and quality indicators.

Jurriaan