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Real estate market and the relevance of local features in a hedonic prices quantil-spatial analysis – the case of Belo Horizonte – Brazil

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Furtado, BERNARDO

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Abstract

The main motivation of this paper is to identify how relevant the localization of a specific estate is in its market value. Furthermore, it aims to understand better how economic aspects influence and are influenced by urban space. In order to do so, a myriad of concepts is drawn from a variety of fields of science: from geography to architecture, from urbanism to economics, as well as methodologies, which are borrowed from statistics, econometrics and geoprocessing. The proposal of the paper follows the hedonic prices function literature, but suggests that a synthesis of the perception of urban amenities can be expressed by the element of the neighbourhood (as proposed by Lynch, 1997). A number of models are presented, tested and commented. The one with the best fit is the spatial error-lag (Anselin, 1988) specified with a ranking of neighbourhood income. A quantil analysis adds considerably to the understanding of the model.

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File URL: http://mpra.ub.uni-muenchen.de/7340/
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 7340.

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Date of creation: Jul 2007
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Handle: RePEc:pra:mprapa:7340

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Related research
Keywords: real estate market; neighbourhoods; spatial econometrics; quantil analysis; Belo Horizonte;

Find related papers by JEL classification:
L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services
R20 - Urban, Rural, and Regional Economics - - Household Analysis - - - General
C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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  1. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January. [Downloadable!] (restricted)
  2. 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 203-22, Jan.-Marc. [Downloadable!] (restricted)
  3. Smirnov, Oleg & Anselin, Luc, 2001. "Fast maximum likelihood estimation of very large spatial autoregressive models: a characteristic polynomial approach," Computational Statistics & Data Analysis, Elsevier, vol. 35(3), pages 301-319, January. [Downloadable!] (restricted)
  4. Sheppard, Stephen, 1999. "Hedonic analysis of housing markets," Handbook of Regional and Urban Economics, in: P. C. Cheshire & E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 3, chapter 41, pages 1595-1635 Elsevier. [Downloadable!] (restricted)
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  5. Bruno Martins Hermann & Eduardo Amaral Haddad, 2003. "Mercado Imobiliário e Amenidades Urbanas: a View Through the Window," Anais do XXXI Encontro Nacional de Economia [Proceedings of the 31th Brazilian Economics Meeting] e17, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics]. [Downloadable!]
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