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A Spatial Autoregressive Specification with a Comparable Sales Weighting Scheme

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  • Claude Besner

    (University of Quebec at Montreal, Montreal, Quebec, Canada, H3C4R2)

Abstract

This research incorporates a Spatial Autoregressive Variable with Similarity components (SARS) within a traditional hedonic model. The behavior of economic agents and the spatial dependence price structure are linked to the real estate appraisal paradigm. The SARS variable’s similarity components generate anisotropies that deform concentric circles of spatial dependence so as to designate the influence exerted by ‘‘comparables.’’ The incorporation of similarity components improves the predictive capacity and reduces the spatial dependence among residuals in the SAR model. The research determines for the Montreal Urban Community the underlying distance parameters of spatial dependence as well as anisotropic factors specific to price interdependence for two single-family house archetypes: the condominium and the individual house.

Suggested Citation

  • Claude Besner, 2002. "A Spatial Autoregressive Specification with a Comparable Sales Weighting Scheme," Journal of Real Estate Research, American Real Estate Society, vol. 24(2), pages 193-212.
    • Handle: RePEc:jre:issued:v:24:n:2:2002:p:193-212
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    References listed on IDEAS

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    1. Dubin, Robin A, 1988. "Estimation of Regression Coefficients in the Presence of Spatially Autocorrelated Error Terms," The Review of Economics and Statistics, MIT Press, vol. 70(3), pages 466-474, August.
    2. Eugene F. Brigham, 1965. "The Determinants of Residential Land Values," Land Economics, University of Wisconsin Press, vol. 41(4), pages 325-334.
    3. Mauricio Rodriguez & C.F. Sirmans & Allen P. Marks, 1995. "Using Geographic Information Systems to Improve Real Estate Analysis," Journal of Real Estate Research, American Real Estate Society, vol. 10(2), pages 163-174.
    4. Anas, Alex & Eum, Sung Jick, 1984. "Hedonic analysis of a housing market in disequilibrium," Journal of Urban Economics, Elsevier, vol. 15(1), pages 87-106, January.
    5. Dubin, Robin A., 1992. "Spatial autocorrelation and neighborhood quality," Regional Science and Urban Economics, Elsevier, vol. 22(3), pages 433-452, September.
    6. Basu, Sabyasachi & Thibodeau, Thomas G, 1998. "Analysis of Spatial Autocorrelation in House Prices," The Journal of Real Estate Finance and Economics, Springer, vol. 17(1), pages 61-85, July.
    7. Pace, R Kelley & Barry, Ronald & Clapp, John M. & Rodriquez, Mauricio, 1998. "Spatiotemporal Autoregressive Models of Neighborhood Effects," The Journal of Real Estate Finance and Economics, Springer, vol. 17(1), pages 15-33, July.
    8. Pace, R Kelley & Gilley, Otis W, 1997. "Using the Spatial Configuration of the Data to Improve Estimation," The Journal of Real Estate Finance and Economics, Springer, vol. 14(3), pages 333-340, May.
    9. Clapp, John M & Rodriguez, Mauricio, 1999. "Erratum: Spatiotemporal Autoregressive Models of Neighborhood Effects," The Journal of Real Estate Finance and Economics, Springer, vol. 19(1), pages 1-85, July.
    10. Anselin, Luc & Hudak, Sheri, 1992. "Spatial econometrics in practice : A review of software options," Regional Science and Urban Economics, Elsevier, vol. 22(3), pages 509-536, September.
    11. Can, Ayse & Megbolugbe, Isaac, 1997. "Spatial Dependence and House Price Index Construction," The Journal of Real Estate Finance and Economics, Springer, vol. 14(1-2), pages 203-222, Jan.-Marc.
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    2. Chica-Olmo, Jorge & Cano-Guervos, Rafael, 2020. "Does my house have a premium or discount in relation to my neighbors? A regression-kriging approach," Socio-Economic Planning Sciences, Elsevier, vol. 72(C).
    3. Sonia Yousfi & Jean Dubé & Diègo Legros & Sotirios Thanos, 2020. "Mass appraisal without statistical estimation: a simplified comparable sales approach based on a spatiotemporal matrix," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 64(2), pages 349-365, April.
    4. John A. Kilpatrick & Ronald C. Throupe & John I. Carruthers & Andrew Krause, 2007. "The Impact of Transit Corridors on Residential Property Values," Journal of Real Estate Research, American Real Estate Society, vol. 29(3), pages 303-320.
    5. Miryam S. Merk & Philipp Otto, 2022. "Estimation of the spatial weighting matrix for regular lattice data—An adaptive lasso approach with cross‐sectional resampling," Environmetrics, John Wiley & Sons, Ltd., vol. 33(1), February.
    6. Yan Kestens & Marius Thériault & François Des Rosiers, 2004. "The Impact of Surrounding Land Use and Vegetation on Single-Family House Prices," Environment and Planning B, , vol. 31(4), pages 539-567, August.
    7. Mirosław Bełej & Radosław Cellmer & Michał Głuszak, 2020. "The Impact of Airport Proximity on Single-Family House Prices—Evidence from Poland," Sustainability, MDPI, vol. 12(19), pages 1-26, September.

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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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