This paper aims to describe the deformation of the factorial model that explains real estate returns over time. If economic and financial factors may be used to estimate a repeat sales factorial index, their impact on the model may change from one period to another.

This research based on the methodology of the factorial index elaborated in Baroni M, Barthélémy F. and Mokrane M, JRER, 2007, addresses this issue and highlights the changing impact of the interest rates. It also tries to identify specific events that provoked these changes.

To reach this objective, the index for the period 1982-2001 is considered as a basis, and then the weights of the factors are estimated by rolling periods with a one-month step until 2015. In this way time series of each factor weights are built and then analysed.

The BIEN database, provided by the Chambre des Notaires of Paris, which includes repeat sales transactions for residential properties in Paris and close surroundings over the 1982-2015 period is used to perform this study.