This study compares the forecasting accuracy of six forecasting models. These include econometric and time series models. The models were calibrated using data on property taxes in 77 Minnesota counties during the period from 1974 through 1980. Forecasts of changes in the real market value of residential real estate were made for the years 1981 through 1983; forecast horizons of 1, 2, and 3 years were examined. The results were, in general, consistent with those from prior research. Interestingly, however, few of the relevant prior studies were cited. The study concluded that:
Now the bad news. All of the forecast comparisons were ex post. The author stated: "Following standard forecast evaluation practice, actual changes in the explanatory variables were used in predicting . . ." Clearly, ex post forecasts are of interest. However, recent practice has placed a heavier emphasis on ex ante (unconditional) forecasts as a way to more closely simulate the forecasting problem. The use of ex post forecasts and the small validation sample (three years) limits the confidence that we can place in the study. Nevertheless, with the exception of the result about econometric models by segment, the results add support for the current beliefs among forecasting researchers.