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Negotiatiated rents ñDo they reflect Neighbourhood Quality? Empirical Evidence from two cities in Sweden

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  • Kicki Björklund
  • Kerstin Klingborg

Abstract

This paper aims to analyse the existence of diffentiated rents reflecting differencies in housing and neighbourhood quality. The system for rent setting in Sweden is partly based on a negotiation process in which the change in rent is an outcome of annual municipality-wise negotiations between the tenant•s association and the municipality-owned housing companies. In this negotiation there is a possibility to let rents develop differently in different neighbourhoods possibly aiming towards better correspondence of rents and tenants conceptions of housing and neighbourhood quality. It is our understanding that the negotiations in several rental housing markets the last decade has consciously aimed towards such rental adjustments. In this paper we use the hedonic method on unique data from two cities in Sweden, Gothenburg and Lule¬. The paper concludes that differentiated rents are present, hence the existing rent setting system in Sweden can be used to improve the relation between rental structure and neighbourhood quality.

Suggested Citation

  • Kicki Björklund & Kerstin Klingborg, 2003. "Negotiatiated rents ñDo they reflect Neighbourhood Quality? Empirical Evidence from two cities in Sweden," ERES eres2003_308, European Real Estate Society (ERES).
    • Handle: RePEc:arz:wpaper:eres2003_308
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    JEL classification:

    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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