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Applying the Hedonic Pricing Model to the Prices of Single-Family Homes in the Oldest U.S. City, St. Augustine, Florida, Testing Whether Property Taxes Are Capitalized into Housing Prices

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  • Angjellari-Dajci, Fiorentina
  • Cebula, Richard

Abstract

This empirical investigation applies a hedonic pricing model to determine whether property taxes have been capitalized into housing prices of single-family homes in city of St. Augustine, Florida housing market for single family homes. There were sufficient data in this context to study a total of 4,017 single-family houses for the six-year period from 2008 to 2013 period. The sales price and property tax levels are expressed real terms, i.e., in 2005 dollars. The semi-log estimation reveals, among other things, that the natural log of the real sales price of a single-family house in the St. Augustine area was in fact negatively affected by the city and county property tax level.

Suggested Citation

  • Angjellari-Dajci, Fiorentina & Cebula, Richard, 2014. "Applying the Hedonic Pricing Model to the Prices of Single-Family Homes in the Oldest U.S. City, St. Augustine, Florida, Testing Whether Property Taxes Are Capitalized into Housing Prices," MPRA Paper 55587, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:55587
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    References listed on IDEAS

    as
    1. Dubin, Robin A, 1998. "Predicting House Prices Using Multiple Listings Data," The Journal of Real Estate Finance and Economics, Springer, vol. 17(1), pages 35-59, July.
    2. Cebula, Richard, 1996. "An Empirical Analysis of the Impact of Government Tax and Auditing Policies on the Size of the Underground Economy: The Case of the United States, 1973-94," MPRA Paper 49810, University Library of Munich, Germany.
    3. Coulson, N Edward & Leichenko, Robin M, 2001. "The Internal and External Impact of Historical Designation on Property Values," The Journal of Real Estate Finance and Economics, Springer, vol. 23(1), pages 113-124, July.
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    7. N. Edward Coulson & Michael L. Lahr, 2005. "Gracing the Land of Elvis and Beale Street: Historic Designation and Property Values in Memphis," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 33(3), pages 487-507, September.
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    More about this item

    Keywords

    housing prices; property tax capitalization; market mechanism;
    All these keywords.

    JEL classification:

    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy

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