IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v6y2014i5p2946-2960d36066.html
   My bibliography  Save this article

Estimation of Hedonic Single-Family House Price Function Considering Neighborhood Effect Variables

Author

Listed:
  • Chihiro Shimizu

    (Faculty of Economics and Business Administration, Reitaku University, 2-1-1 Hikarigaoka, Kashiwa, Chiba 277-8686, Japan)

Abstract

In the formulation of hedonic models, in addition to locational factors and building structures which affect the house prices, the generation of the omitted variable bias is thought to occur in cases when local environmental variables and the individual characteristics of house buyers are not taken into consideration. However, since it is difficult to obtain local environmental information in a small neighborhood unit and to observe individual characteristics of house buyers, these variables have not been sufficiently considered in previous studies. We demonstrated that non-negligible levels of omitted variable bias are generated if these variables are not considered.

Suggested Citation

  • Chihiro Shimizu, 2014. "Estimation of Hedonic Single-Family House Price Function Considering Neighborhood Effect Variables," Sustainability, MDPI, vol. 6(5), pages 1-15, May.
    • Handle: RePEc:gam:jsusta:v:6:y:2014:i:5:p:2946-2960:d:36066
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/6/5/2946/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/6/5/2946/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jackson, Jerry R., 1979. "Intraurban variation in the price of housing," Journal of Urban Economics, Elsevier, vol. 6(4), pages 464-479, October.
    2. Ivar Ekeland & James J. Heckman & Lars Nesheim, 2004. "Identification and Estimation of Hedonic Models," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages 60-109, February.
    3. 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..
    4. Goodman, Allen C. & Thibodeau, Thomas G., 2003. "Housing market segmentation and hedonic prediction accuracy," Journal of Housing Economics, Elsevier, vol. 12(3), pages 181-201, September.
    5. Kanemoto, Yoshitsugu & Nakamura, Ryohei, 1986. "A new approach to the estimation of structural equations in hedonic models," Journal of Urban Economics, Elsevier, vol. 19(2), pages 218-233, March.
    6. Allen C. Goodman & Thomas G. Thibodeau, 1998. "Dwelling Age Heteroskedasticity in Repeat Sales House Price Equations," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 26(1), pages 151-171, March.
    7. Chihiro Shimizu & Kiyohiko Nishimura, 2007. "Pricing Structure in Tokyo Metropolitan Land Markets and its Structural Changes: Pre-bubble, Bubble, and Post-bubble Periods," The Journal of Real Estate Finance and Economics, Springer, vol. 35(4), pages 475-496, November.
    8. Chihiro Shimizu & Kiyohiko G. Nishimura & Yasushi Asami, 2004. "Search And Vacancy Costs In The Tokyo Housing Market: Attempt To Measure Social Costs Of Imperfect Information," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 16(3), pages 210-230, November.
    9. repec:dau:papers:123456789/6486 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xu Zhang & Xiaoxing Liu & Jianqin Hang & Dengbao Yao & Guangping Shi, 2016. "Do Urban Rail Transit Facilities Affect Housing Prices? Evidence from China," Sustainability, MDPI, vol. 8(4), pages 1-14, April.
    2. Sabrina-Sigrid Spiegel, 2022. "Price Indices for Austrian municipalities - Hedonic models based on Microlevel Data," Graz Economics Papers 2022-01, University of Graz, Department of Economics.
    3. Nishi, Hayato & Asami, Yasushi & Shimizu, Chihiro, 2021. "The illusion of a hedonic price function: Nonparametric interpretable segmentation for hedonic inference," Journal of Housing Economics, Elsevier, vol. 52(C).
    4. My-Linh Thi Nguyen, 2020. "The Hedonic Pricing Model Applied to the Housing Market," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(3), pages 416-428.
    5. Zuo Zhang & Xinhai Lu & Min Zhou & Yan Song & Xiang Luo & Bing Kuang, 2019. "Complex Spatial Morphology of Urban Housing Price Based on Digital Elevation Model: A Case Study of Wuhan City, China," Sustainability, MDPI, vol. 11(2), pages 1-17, January.
    6. Shengfu Yang & Shougeng Hu & Weidong Li & Chuanrong Zhang & José A. Torres, 2017. "Spatiotemporal Effects of Main Impact Factors on Residential Land Price in Major Cities of China," Sustainability, MDPI, vol. 9(11), pages 1-16, November.
    7. Celia Bilbao-Terol & Verónica Cañal-Fernández & Luis Valdés & Eduardo Del Valle, 2017. "Rural Tourism Accommodation Prices by Land Use-Based Hedonic Approach: First Results from the Case Study of the Self-Catering Cottages in Asturias," Sustainability, MDPI, vol. 9(10), pages 1-17, September.
    8. Nam Bui & Le Wen & Basil Sharp, 2024. "House Prices and Flood Risk Exposure: An Integration of Hedonic Property Model and Spatial Econometric Analysis," The Journal of Real Estate Finance and Economics, Springer, vol. 69(1), pages 100-131, July.
    9. Natividad Guadalajara & Miguel Ángel López & Adina Iftimi & Antonio Usai, 2021. "Influence of the Cadastral Value of the Urban Land and Neighborhood Characteristics on the Mean House Mortgage Appraisal," Land, MDPI, vol. 10(3), pages 1-17, March.
    10. Biao Sun & Shan Yang, 2020. "Asymmetric and Spatial Non-Stationary Effects of Particulate Air Pollution on Urban Housing Prices in Chinese Cities," IJERPH, MDPI, vol. 17(20), pages 1-23, October.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Diewert, W. Erwin & Nishimura , Kiyohiko & Shimizu, Chihiro & Watanabe, Tsutomu, 2014. "Residential Property Price Indexes for Japan: An Outline of the Japanese Official RPPI," Economics working papers erwin_diewert-2014-17, Vancouver School of Economics, revised 27 Mar 2014.
    2. Nishi, Hayato & Asami, Yasushi & Shimizu, Chihiro, 2021. "The illusion of a hedonic price function: Nonparametric interpretable segmentation for hedonic inference," Journal of Housing Economics, Elsevier, vol. 52(C).
    3. Shimizu Chihiro & Nishimura Kiyohiko G. & Watanabe Tsutomu, 2010. "Housing Prices in Tokyo: A Comparison of Hedonic and Repeat Sales Measures," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 230(6), pages 792-813, December.
    4. Wolf, David & Klaiber, H. Allen & Gopalakrishnan, Sathya, 2022. "Beyond marginal: Estimating the demand for water quality," Resource and Energy Economics, Elsevier, vol. 68(C).
    5. Palmquist, Raymond B., 2006. "Property Value Models," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 2, chapter 16, pages 763-819, Elsevier.
    6. Myung-Jin Jun, 2018. "Quantifying Welfare Impacts of Air Pollution in Seoul: A Two-Stage Hedonic Price Approach," Journal of Environmental Assessment Policy and Management (JEAPM), World Scientific Publishing Co. Pte. Ltd., vol. 20(02), pages 1-25, June.
    7. Lucija Muehlenbachs & Elisheba Spiller & Christopher Timmins, 2015. "The Housing Market Impacts of Shale Gas Development," American Economic Review, American Economic Association, vol. 105(12), pages 3633-3659, December.
    8. Patrick Bayer & Fernando Ferreira & Robert McMillan, 2007. "A Unified Framework for Measuring Preferences for Schools and Neighborhoods," Journal of Political Economy, University of Chicago Press, vol. 115(4), pages 588-638, August.
    9. David M. Brasington & Diane Hite, 2005. "Demand for Environmental Quality: A Spatial Hedonic Approach," Departmental Working Papers 2005-08, Department of Economics, Louisiana State University.
    10. Fève, Frédérique & Fève, Patrick & Florens, Jean-Pierre, 2002. "Attribute Choices and Structural Econometrics of Price Elasticity of Demand," IDEI Working Papers 155, Institut d'Économie Industrielle (IDEI), Toulouse, revised 2003.
    11. Stefan Sebastian Fahrländer, 2006. "Semiparametric Construction of Spatial Generalized Hedonic Models for Private Properties," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 142(IV), pages 501-528, December.
    12. Diewert, Erwin & Shimizu, Chihiro, 2015. "Residential Property Price Indices For Tokyo," Macroeconomic Dynamics, Cambridge University Press, vol. 19(8), pages 1659-1714, December.
    13. James J. Heckman, 2019. "The Race Between Demand and Supply: Tinbergen’s Pioneering Studies of Earnings Inequality," De Economist, Springer, vol. 167(3), pages 243-258, September.
    14. DESBOIS, Dominique, 2015. "La qualité du lait a-t-elle un prix ? Une estimation hédonique de la valeur des attributs spécifiques du lait de vache," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 96(3), September.
    15. Shimizu, Chihiro, 2014. "How Are Property Investment Returns Determined? : Estimating the Micro-Structure of Asset Prices, Property Income, and Discount Rates," HIT-REFINED Working Paper Series 12, Institute of Economic Research, Hitotsubashi University.
    16. Wong, Maisy, 2010. "The Relationship between Marginal Willingness-to-Pay in the Hedonic and Discrete Choice Models," MPRA Paper 51218, University Library of Munich, Germany.
    17. von Graevenitz, Kathrine, 2018. "The amenity cost of road noise," Journal of Environmental Economics and Management, Elsevier, vol. 90(C), pages 1-22.
    18. Patrick Bayer & Robert McMillan & Kim Rueben, 2004. "An Equilibrium Model of Sorting in an Urban Housing Market," NBER Working Papers 10865, National Bureau of Economic Research, Inc.
    19. Han, Seungjin & Yamaguchi, Shintaro, 2015. "Compensating wage differentials in stable job matching equilibrium," Journal of Economic Behavior & Organization, Elsevier, vol. 114(C), pages 36-45.
    20. Marco Helbich & Wolfgang Brunauer & Eric Vaz & Peter Nijkamp, 2014. "Spatial Heterogeneity in Hedonic House Price Models: The Case of Austria," Urban Studies, Urban Studies Journal Limited, vol. 51(2), pages 390-411, February.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:6:y:2014:i:5:p:2946-2960:d:36066. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.