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What is the Value of a Name? Conspicuous Consumption and House Prices

Author

Listed:
  • Velma Zahirovic-Herbert

    (The University of Georgia)

  • Swarn Chatterjee

    (The University of Georgia)

Abstract

This study is the first to lend empirical support to anecdotal media reports that indicate that real property buyers are willing to pay price premiums based on property names. Using a standard hedonic price model, we explore the price effects of property names that include the terms “country†and “country club†within a neighborhood. We find that buyers assign a premium of 4.2 percent for the term “country†and an additional 5.1 percent for the term “country club†in the property name. We also find that wealthier buyers tend to be the leaders in paying this price premium, but that buyers are less willing to pay these premiums during recessionary times.

Suggested Citation

  • Velma Zahirovic-Herbert & Swarn Chatterjee, 2011. "What is the Value of a Name? Conspicuous Consumption and House Prices," Journal of Real Estate Research, American Real Estate Society, vol. 33(1), pages 105-126.
    • Handle: RePEc:jre:issued:v:33:n:1:2011:p:105-126
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    Cited by:

    1. Prashant Das & Patrick Smith & Paul Gallimore, 2018. "Pricing Extreme Attributes in Commercial Real Estate: the Case of Hotel Transactions," The Journal of Real Estate Finance and Economics, Springer, vol. 57(2), pages 264-296, August.
    2. Costin CIORA, 2016. "Is there a conspicuous consumption effect in Bucharest housing market?," Romanian Journal of Economics, Institute of National Economy, vol. 42(1(51)), pages 164-174, june.
    3. Liao, Wen-Chi & Jing, Kecen & Lee, Chaun Ying Rachel, 2022. "Economic return of architecture awards: Testing homebuyers’ motives for paying more," Regional Science and Urban Economics, Elsevier, vol. 93(C).
    4. Aronsson, Thomas & Mannberg, Andrea, 2015. "Relative consumption of housing: Marginal saving subsidies and income taxes as a second-best policy?," Journal of Economic Behavior & Organization, Elsevier, vol. 116(C), pages 439-450.

    More about this item

    JEL classification:

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

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