Real estate investment trust returns: Predictability and determinants

Abstract

This theoretical paper has two main educational purposes. The first is to revisit the recent changes made to the most popular macroeconomic model of the housing market, the four-quadrant model. The second is to show the similarities and differences of the new approach to the macroeconomic analysis of the real estate market, namely the search and matching models. Indeed, I show that integration is feasible and that the resulting model gains descriptive power without losing its simplicity.