Development of a Real Estate Bubble Index Prototype for the Canton of Aargau

Abstract

The criteria for mortgage lending, set by governmental regulations and the Swiss financial market supervisory authority, were last tightened in 2014. As a consequence of this stricter framework, Swiss financial houses had to reassess their mortgage portfolios. In order to monitor real estate price developments and, connected thereto, the compliance of their customers with the stricter regulations, some Swiss financial houses have recently developed real estate price indices or real estate bubble indices for their areas of business. However, as no monitoring tool of this type exists specifically for the canton of Aargau, the aim of this bachelor's thesis is to develop a prototype real estate bubble index for this area.