A Further Examination of Appraisal Data and the Potential Bias in Real Estate Return Indexes |
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| Authors: | George W Gau Ko Wang |
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| Institution: | Department of Finance, University of Austin at Texas, Austin, Texas 78712.;Department of Finance, California State University-Fullerton, Fullerton, California 92634. |
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| Abstract: | Recent articles by Giliberto 2] and Geltner 1] examine the biases inherent in the use of appraisal data in real estate performance measurement. This note takes another look at the direction and magnitude of any bias in holding period returns. Using appraisal data from a commingled real estate fund, we show that in actual application the size of the holding period return bias can be quite small and this bias may have no appreciable effect on real estate return indexes. |
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