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Overvaluation actions suggest the amount of RRE rate misalignment, consequently they are put, with other relevant symptoms, so you can assess new drawback dangers so you’re able to RRE prices

Sources: ECB and you may ECB data.Notes: Committee an excellent) The new overvaluation estimates are based on the typical regarding a couple actions: a keen econometric model and you will home rates-to-money ratio deviation of historic mediocre. Having facts, discover Box 3 Tools for discovering a possible misalignment from land rates from fundamentals throughout the problem of the fresh ECB Monetary Balance Comment, and/or Package 3 A model-depending valuation metric getting house issue of brand new ECB Financial Balance Opinion. For the y-axis, a plus indication (+) ways overvaluation and you will a minus signal (-) undervaluation. Committee b) Results from a keen RRE price-at-exposure model considering a panel quantile regression into the an example off 19 euro city regions. Explanatory parameters: lag out-of real domestic rate gains, overvaluation (average of deviation of home rate-to-earnings proportion out of enough time-title average and you may econometric model), systemic risk indicator, user depend on sign, monetary sector criteria indication trapping stock rate development and you can volatility, government bond give, hill out of give contour, euro city low-financial business thread give, and you can a communicating regarding overvaluation and an economic standards directory. Lire Plus