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Producer price index for construction of dwellings

Producer price index for construction of dwellings demonstrates trends in prices at the first stage of commercial transactions for the construction of free standing one-family houses, i.e. the producer price incl. direct construction costs and profits, but excl. VAT, cost of land and other costs not directly linked to the construction. The statistic is typically used in analyses of price developments in the construction sector. It has been compiled since 2019 with indices dating back to 2015.

Statistical presentation

The Producer Price Index for Construction of Dwellings is a quarterly measurement of price developments of commercial transactions related to the construction of new dwellings, i.e. the price a household or a developer pays the construction company for the construction of a dwelling. The statistic only covers construction of free standing one-family houses, and is therefore not representative of e.g. multi-family houses, terraced houses, general housing, vacation homes or commercial/industrial buildings.

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Statistical processing

Every quarter approximately 500-1200 prices are collected from a sample of relevant type house construction companies in Denmark. Prices are collected through an electronic reporting form via Business in Denmark. The collected prices are merged with relevant information from the Danish Buildings and Dwellings Register (BBR), such as total area, number of bath rooms and roofing material. The index is calculated by use of a hedonic regression where different information (characteristics of the single dwelling) is used.

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The Producer Price Index for Construction of Dwellings is a business cycle indicator, which is used in analyses of economic developments in Denmark. It is used in the Danish National Accounts, and is part of the framework of EU short term business statistics. Surveys of user satisfaction are not performed, but the statistics is part of Danish Statistics' expert committee for statistics on housing and civil engineering.

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Accuracy and reliability

The statistic's accuracy is considered to be high, although a some possible sources of error exist. The collected price observations are examined for errors both manually and by computer. The extend of different error types is therefore considered to be negligible. As the collected data originates solely from typehouse companies, the statistic is considered to be more accurate for typical housing constructions and less so for unique constructions. Also, the used hedonic statistical model does not consider the quality of applied building materials or the quality of the work carried out.

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Timeliness and punctuality

These statistics are published quarterly, approx. 3-4 month after the end of the reference period.

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The statistic has a continuous time series from 2015 until present day. The statistic follows international standards and is therefore comparable with similar statistics from other countries.

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Accessibility and clarity

The statistic is published quarterly in the Statbank as Producer Price Index for Construction of Dwellings (PRIS90) and can be found at the subject page Indices for the construction sector. Once a year, in conjunction with the publication of 4th quarter indices (in April), the statistic is published in News from Statistics Denmark, which is available only in Danish under the title "Producentprisindeks for byggeri".

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