tailieunhanh - Property Valuation Modeling and Forecasting_10

Tham khảo tài liệu 'property valuation modeling and forecasting_10', tài chính - ngân hàng, đầu tư bất động sản phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | Real estate forecasting in practice 427 an expert makes an adjustment to the forecast driven by future employment growth this adjustment is based on a less efficient use of the historical relationship between rent and employment growth. The expert should direct his her efforts towards influences that will genuinely add to the forecast. When the forecasts from a model and expert opinion bring different kinds of information and when the forecasts are not correlated it is beneficial to combine them Sanders and Ritzman 2001 . 2 Track record assessment. Purely judgemental forecasts or adjusted model forecasts should be evaluated in a similar manner to forecasts from econometric models. The literature on this subject strongly suggests that track record is important. It is the only way to show whether expert opinion is really beneficial and whether judgement leads to persistent outperformance. It provides trust in the capabilities of the expert and helps the integration and mutual appreciation of knowledge between the quantitative team and market experts. Clements and Hendry 1998 assert that the secret to the successful use of econometric and time series models is to learn from past errors. The same approach should be followed for expert opinions. By documenting the reasons for the forecasts Goodwin 2000a argues that this makes experts learn from their past mistakes and control their level of unwarranted intervention in the future. It enables the expert to learn why some adjustments improve forecasts while others do not. As Franses 2006 notes the best way to do this is to assess the forecasts based on a track record. Do the experts look at how accurate their forecasts are though Fildes and Goodwin 2007 find that experts are apparently not too bothered about whether their adjustments actually improve the forecasts. This does not help credibility and hence it is important to keep track records. 3 Transparency. The way that the forecast is adjusted and the judgement is .