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Determining Housing Prices Using The Semiparametric Estimation Within The Hedonic Price Model Framework: Case Study of Istanbul Housing Market Example

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  • Tuğçe Acar

Abstract

Different properties of the houses have given heterogeneous structure to the housing markets. Therefore, the housing market can be analyzed with the hedonic price model In this direction, this study is important in terms of revealing the effects of different characteristics of houses on housing prices to follow the price changes in the housing market. The study aims to examine the effect of flat-type residential properties in İstanbul on the price within the scope of hedonic price model. For this purpose, estimation was made with semiparametric regression models for 974 flat-house, housing prices and factors affecting prices. In as much as the semiparametric estimation is superior to parametric estimation in that it doesn’t force the data set to certain assumptions and takes into account the variable structure that has a nonlinear effect on the dependent variable. According to the findings, the properties that affect the housing prices (apartment) for sale are determined as the parking variable, credit eligibility variable, and elevator variable respectively. As for the nonparametric variables, it was concluded that the square meter variable had a reducing effect on house prices after 400 m2, and the age of housing had a positive effect on prices after 15 years.

Suggested Citation

  • Tuğçe Acar, 2020. "Determining Housing Prices Using The Semiparametric Estimation Within The Hedonic Price Model Framework: Case Study of Istanbul Housing Market Example," Journal of Research in Economics, Politics & Finance, Ersan ERSOY, vol. 5(3), pages 561-575.
    • Handle: RePEc:ahs:journl:v:5:y:2020:i:3:p:561-575
    DOI: 10.30784/epfad.747705
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    References listed on IDEAS

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    1. Stadelmann, David, 2010. "Which factors capitalize into house prices? A Bayesian averaging approach," Journal of Housing Economics, Elsevier, vol. 19(3), pages 180-204, September.
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    3. Elif Alkay, 2008. "Housing Submarkets in Istanbul," International Real Estate Review, Global Social Science Institute, vol. 11(1), pages 113-127.
    4. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    5. Straszheim, Mahlon R, 1974. "Hedonic Estimation of Housing Market Prices: A Further Comment," The Review of Economics and Statistics, MIT Press, vol. 56(3), pages 404-406, August.
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    Cited by:

    1. Ilyas Siklar, 2024. "The Role of Speculative Demand in Housing Price Changes in Turkey," Business and Economic Research, Macrothink Institute, vol. 14(2), pages 34-60, December.

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    More about this item

    Keywords

    Istanbul Housing Market; Hedonik Price Model; Nonparametric Approach; Semiparametric Estimation;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

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