The Amsterdam rent index: The housing market and the economy, 1550–1850

• Published in: Journal of housing economics 2012-12, Vol.21 (4), p.269-282
• Main Authors: Eichholtz, Piet, Straetmans, Stefan, Theebe, Marcel
• Format: Article
• Language: English
• Subjects: Amsterdam housing market; Business cycles; Economic activity; Housing market; Long term; Netherlands; Price theory; Real estate market; Rent; Rent index
• ISSN: 1051-1377; 1096-0791
• DOI: 10.1016/j.jhe.2012.09.001

► This article presents a housing market rent index for Amsterdam covering 300years. ► Real house rents in Amsterdam had approximately the same level in 1850 as they did in 1550. ► The real index moves between 45.6 and 162.4. The paper investigates the long run historic development of the Amsterdam rental housing market (1550–1850). Using rent data on a large cross section of residential properties in Amsterdam we are able to develop an annual constant-quality rent index for the entire time period. Whereas nominal rents nearly tripled over the considered sample period, average Amsterdam house rents, in real terms, had approximately the same level in 1850 as they exhibited in 1550. Otherwise stated, nominal rents and goods prices rose at the same pace. Over these 301years, the real index moves between a minimum level of 45.6 and a maximum of 162.4. As concerns the relation between the housing market and the real economy, we find empirical evidence that fluctuations in rents and fluctuations in proxies of business cycle activity comove, both in nominal and in real terms.