Owner-Occupied Housing Price Index

The Owner-Occupied Housing Price Index (OOHPI) measures the changes in the transaction prices of dwellings new to the household sector as well as prices of goods and services that households acquire in their role as owner-occupiers.

The OOHPI is a price index covering new dwellings, existing dwellings that are new to the household sector, other services related to the acquisitions of dwellings, major repairs and maintenance, insurance connected with the dwelling and other services associated with ownership of dwellings.

This index meets the requirements of the Harmonized Indices of Consumer Prices (HICP) and is built based on the net acquisitions approach.

N/A

Population Coverage

The OOHPI covers all transactions in which households are indicated as buyer or recipient of the services  and legal entity, municipality or government as seller or service provider. The OOHPI includes also purchases of dwellings and other goods and services connected with purchase or ownership of the dwelling made by households – non-residents within the economic area of Latvia.

The OOHPI excludes transactions between legal entities, municipalities and government, as well as deals engaging legal entity as a buyer and household as a seller.

The OOHPI does not cover transactions with commercial areas, outhouses, saunas, garages, cellars, gazebos and other structures unfit for human occupancy.

Geographical coverage

Whole territory of the Republic of Latvia.

• Regulation (EU) 2016/792 of the European Parliament and of the Council of 11 May 2016 on harmonised indices of consumer prices and the house price index.
• Commission Implementing Regulation (EU) 2023/1470 of 17 July 2023 laying down the methodological and technical specifications in accordance with Regulation (EU) 2016/792 of the European Parliament and of the Council as regards the house price index and the owner-occupied housing price index.

Statistics database

EU Member state data in Eurostat database.

Since 2010

N/A

The main data source used to obtain information is the State Unified Computerized Land Register, as well as separate surveys that were made to calculate sub-indices.

The weights reflect structure of the acquisition of dwellings and other goods and services that households acquire in their role as owner-occupiers in the year T-2. The weights are revised every year and recalculated into the prices of the 4^th quarter of the previous year. 

N/A

The OOHPI is a Laspeyres-type price index.

The OOHPI is based on the “net acquisitions” approach.

To calculate the new dwellings and existing dwellings new to households’ indices, all transactions are stratified into the groups (strata).

The group index is calculated as geometric mean of transaction prices ratio between comparison and reference periods.

In order to adjust structural (qualitative) dwelling transaction differences between the comparison and reference periods, a hedonic regression method is used within each group. By the method based on the most significant price determinants a dwelling hypothetical value is calculated.

, where

 – a natural logarithm of transaction price;

 – the price factors;

 – the regression coefficients (factor impacts);

 – the constant.

The factors having the greatest impact on the dwelling price and taken into account in the OOHPI calculations of new dwellings and existing dwellings new to households are geographical location of the property, property size (area) and availability of amenities.

For the calculation of higher level price indices and the OOHPI a Laspeyres-type formula that expresses the weighted arithmetic mean value of the lower level price indices is used:

 , where

 – the OOHPI in the period T, compared to the period 0 (reference period);

 – the price index j expenditure share of total expenditures related to acquisition of dwellings and goods and services related to ownership of dwellings in a reference period;

 – the price index j in a period T, compared to the period 0 (reference period).