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Modeling Housing Demand for New Residential Buildings in Urban Areas

Author

Listed:
  • Reza Najarzadeh

    (Department of Economics, Tarbiat Modares University, Iran.)

  • Amene Shahidi

    (Department of Economics, Tarbiat Modares University, Iran.)

Abstract

This study investigates the factors affecting the demand for new residential buildings in urban areas of Iran during 1976-2010. The demand function for new residential buildings in urban areas was estimated and then the existence of a long-run relationship among variables of this function was studied using the Bounds testing of the Autoregressive Distributed Lag Co-integration procedure. The test confirmed a long-run relationship among the variables, so the coefficients of the short-term and long-term demand for new residential buildings were estimated. The results show that the average income of urban households has the biggest impact on the long-term demand of new residential buildings and its sign is positive. In the short-term, the biggest impact on the demand for new residential buildings is the average cost of constructing a residential building, with a negative impact on the demand.

Suggested Citation

  • Reza Najarzadeh & Amene Shahidi, 2015. "Modeling Housing Demand for New Residential Buildings in Urban Areas," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 19(2), pages 165-176, Spring.
    • Handle: RePEc:eut:journl:v:19:y:2015:i:2:p:165
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    References listed on IDEAS

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    Cited by:

    1. Rong Fu & Dong Deng & Tao Liu, 2023. "The Impact of Aging on Housing Market: Evidence from China," Sustainability, MDPI, vol. 15(5), pages 1-13, February.

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