Global Housing Returns, Discount Rates, and the Emergence of the Safe Asset, 1465 2024

Paul Schmelzing

Research

77 Pages

Boston College reconstructs centuries of housing returns and discount rates to understand how real estate and sovereign bonds evolved as core assets. The study pieces together archival transaction and rental data for major markets from 1465 onward. Evidence suggests that housing initially served as the primary safe asset before sovereign bonds took over in the seventeenth century.

Date published: July 14, 2025

Key Takeaways

Long horizon dataset: Builds a repeat sales style housing return series that spans many centuries and multiple countries.
Safe asset evolution: Explains how investor perceptions of safety shifted from land toward sovereign debt over time.
Discount rate insight: Uses housing valuations to infer slow moving changes in required returns across eras.
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