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An hierarchical approach to the segmentation of residential demand: theory and application


  • E Feitelson


Despite its importance for housing-market forecasts, residential demand segmentation has received only little systematic scrutiny. In this paper a hierarchical approach is proposed whereby households are segmented by three levels determined by the likelihood of household shifting among strata as defined within the level. First, households are differentiated according to societal constraints (the most difficult to overcome). Second, groups facing similar constraints are stratified by the basic life-style choices made by households. Last, households are stratified according to their situation, which includes their stage in the life cycle and income (the most likely to change over time). An empirical comparison of a hierarchical segmentation which includes life-style elements (the least understood level of the hierarchy) with cross-sectional sociodemographic segmentation shows the hierarchical approach to perform better on several criteria.

Suggested Citation

  • E Feitelson, 1993. "An hierarchical approach to the segmentation of residential demand: theory and application," Environment and Planning A, Pion Ltd, London, vol. 25(4), pages 553-569, April.
  • Handle: RePEc:pio:envira:v:25:y:1993:i:4:p:553-569

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    Cited by:

    1. Karen M. Gibler & Tanja Tyvimaa, 2014. "The Potential for Consumer Segmentation in the Finnish Housing Market," Journal of Consumer Affairs, Wiley Blackwell, vol. 48(2), pages 351-379, June.
    2. repec:eee:transa:v:107:y:2018:i:c:p:65-74 is not listed on IDEAS
    3. David C. Wheeler & Antonio Páez & Jamie Spinney & Lance A. Waller, 2014. "A Bayesian approach to hedonic price analysis," Papers in Regional Science, Wiley Blackwell, vol. 93(3), pages 663-683, August.
    4. Nurit Alfasi & Shlomit Flint Ashery & Itzhak Benenson, 2013. "Between the Individual and the Community: Residential Patterns of the Haredi Population in Jerusalem," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 37(6), pages 2152-2176, November.

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