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The Effect of Hybrid Attributes on Property Prices

Author

Listed:
  • Copiello Sergio

    (Department of Architecture, University IUAV of Venice)

  • Cecchinato Filippo

    (Department of Architecture, University IUAV of Venice)

  • Salih Mohammed Haj

    (Department of Architecture, University IUAV of Venice)

Abstract

This study focuses on the sales comparison and the adjustment grid methods, under the framework of the market approach to valuation. The literature mostly focuses on the structural qualities of the properties, referring to the buildings and their locational characteristics, which pertain to their positioning within the urban fabric. Here we focus on a particular set of attributes which depend on how a building is placed in a specific land plot and relate to the surrounding environment. The term «hybrid» is used to identify this class of attributes. It is shown that hybrid attributes affect property prices and should not be disregarded by practitioners and appraisers. The role played by hybrid characteristics is analyzed based on the methodological foundation of the hedonic and the adjustment grid methods. The derived linear and log-linear models are tested by means of a case study. The models prove to have high explanatory power. The weight of each hybrid attribute is estimated to vary between 1% and 10%. Overall, these attributes contribute to 17-23% of the property prices. The validation performed using the grid adjustment method shows that the estimated marginal prices are effective in adjusting the prices per unit area of the comparables.

Suggested Citation

  • Copiello Sergio & Cecchinato Filippo & Salih Mohammed Haj, 2021. "The Effect of Hybrid Attributes on Property Prices," Real Estate Management and Valuation, Sciendo, vol. 29(4), pages 36-52, December.
    • Handle: RePEc:vrs:remava:v:29:y:2021:i:4:p:36-52:n:6
    DOI: 10.2478/remav-2021-0028
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    References listed on IDEAS

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    More about this item

    Keywords

    market comparison approach; sales comparison method; adjustment grid method; hybrid attributes; marginal prices;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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