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on Urban and Real Estate Economics |
| By: | S.Guler Kang Uyar; N. Yayla; B. Guloglu |
| Abstract: | The housing market is consisted of sub-markets that give it segmented structure and it exhibits heterogeneous characteristic due to both immovable and durableness of houses and their different structural, location and neighborhood characteristics from each other. Accordingly, each sub-market has different pricing structure owing to different supply and demand conditions of each individual market. Therefore, price estimation process for houses are rather difficult. However, Hedonic Pricing Approach especially used in pricing of products in heterogeneous markets that enables calculation of marginal impacts of individual characteristics on price of products and facilitates house pricing process. During investigation of the relationship between real estate prices and their characteristics, spatial effects are required to be taken into consideration which are significant determinant in house prices. Spatial effects can be presented as spatial autocorrelation and spatial heterogeneity. Whereas spatial dependency among house prices, which arise as a result of adjacency effect are described as spatial autocorrelation, variation in relationship between house prices and their characteristics based on the segmented structure of the housing market are described as spatial heterogeneity. Therefore during investigation of the relationship between house prices and their characteristics, there is need for models which allow relationships to vary according to locations and which consider spatial dependency in house prices. While Non-Parametric Spatial Models are appropriate for the standing need, the OLS Regression Model or Parametric Spatial Models do not take spatial effects into consideration because of their limiting assumptions. The present paper aims to have better understanding on demand side of the Istanbul Real Estate Market by investigating marginal effects of various characteristics of 2838 houses from 39 counties, which are assumed to represent Istanbul Real Estate Market through Non-Parametric Spatial Models based on Hedonic Pricing Approach in the period of October-December 2013. The results obtained from estimation through Non-parametric Spatial Models revealed that the relationship between house prices and their characteristics is differentiated for each sub-market and that there is non-linear relationship between house prices and spatial characteristics. |
| Keywords: | Hedonic Pricing Approach; Istanbul Real Estate Market; Non-Parametric Spatial Models; Spatial Effects |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_289&r=all |
| By: | C.Marmolejo Duarte; J.Camilo Ech Ochoa |
| Abstract: | In the monocentric classic model the bid rent theory suggest a trade-off between land value and transport costs between residential location and the CBD where all employment is likely to be concentrated. Nevertheless, contemporary metropolises significantly apart from that stylized model for a number of reasons. Firstly, monocentricity coexist with polynucleation and employment diffusion and, secondly the place of work does not exerts the only, and probably, nor the main influence on quotidian travel behaviour, since transport surveys reveals an emergence of non-labour mobility. In this paper we test in Barcelona Metropolitan Area, a very well recognised polycentric Mediterranean city, whether proximity to subcentres is a key determinant of housing prices. Using listing prices an hedonic model is built, and the asking price is regressed over the distance to different subcenters, identified by analysing the travel and spatial behaviour of people, among other control variables. The results suggest that subcentres does exert little influence on housing prices and other amenities have a significant influence on the spatial distribution of values. |
| Keywords: | Housing Prices; Land Value; Polycentrism; Urban Economics |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_6&r=all |
| By: | B. Glumac; W. Thomas |
| Abstract: | Purpose - This paper contains the findings of dwelling buyers' preferences towards installed photovoltaic (PV) system on their potential homes and thus provides an insight on the overall impact of PV systems to home purchasing._Design/methodology/approach - These preferences are determined by a discrete choice model that is based on stated preference data of dwelling buyers in the Eindhoven region. Findings - The most important findings are that a PV system is on average highly appreciated by dwelling buyers and that this appreciation is relatively larger by dwelling buyers that live in more urban/central neighborhoods. Research limitations/implications - This paper is essentially exploratory and raises a number of questions for further investigation such as determining the real estate value of installed PV systems. Practical implications - The findings would suggest that the diversity of homebuyers' preferences would vary. It is dependent on the homebuyers;personal characteristics but also on institutional settings of an energy system. Therefore, the provided insight must be regarded as local and further research is necessary for understanding the impact on the European residential real estate markets. Originality/value - This paper estimates the impact of the installed PV system on the housing choice by stated choice data on the local housing market. |
| Keywords: | Eindhoven; Multi Nominal Logit (MNL); Preferences; Pv System; Willingness To Pay (WTP) |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_135&r=all |
| By: | T. Tyvimaa; K. Gibler; V. Zahirovic-Herbert |
| Abstract: | The value of property in residential neighborhoods depends, in part, on the surrounding housing stock due to the effect of housing externalities. We investigate the impact of age-restricted housing on the price of neighboring condominiums in Tampere, Finland. A spatial pattern emerges in all our specifications: age-restricted housing implies an increase in surrounding housing values within a radius of 200 meters of up to 2.65% and up to another 2.47% increase for an additional age-restricted property within 400 meters. The positive spillover effect of owner-occupied age-restricted housing is larger than that of rental housing. The positive effect of senior houses on surrounding properties is diminished if the age-restricted property has an onsite nursing care unit. In addition, the positive effects of age-restricted houses are not extended to assisted living facilities. |
| Keywords: | Age-Restricted Housing; Condominium; Finland; House Prices; Housing Markets |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_218&r=all |
| By: | Vanessa Galeano (Departamento de Economia, Universidad Catolica del Norte); Marcelo Lufin (Departamento de Economia, Universidad Catolica del Norte) |
| Abstract: | Colombia’s second largest city, Medellin, has transformed itself over the last two decades to become a model for social and sustainable urban development. After suffering deep crisis during the decades of 70’s and 80’s due to economic and social factors, the urban and city transformation is remarkable. Medellín has opted to use the architecture and urbanism as a tool for social development, redressing deep and long-standing social and spatial imbalances. Medellín’s urban change involve a comprehensive strategy that seek solutions to mobility, governance and education together with recovery of public space and green areas. The city has developed law – enforcement initiatives and making a series of innovative, public investment, such as urban gondolas and hillside electrical escalators, designed to integrate the city’s low – income residents and communities with its wealthier commercial center (Rodin, 2014). This study attempt to measure the implicit price of urban attributes in determining housing values of Medellín. We assess the extent to which neighborhood and locational characteristics may affect the marginal willingness to pay (MWTP) using a sample of over 11.000 individual houses based in city’s cadastral data for 2011. Our study take an explicit spatial econometrics perspective. We account for spatial dependence and endogeneity using S2SLS and GS2SLS estimations (Kelejian and Prucha, 1998, 1999) and also for spatial heterogeneity (heteroskedasticity in the error terms) using Kelejian-Prucha HAC estimator and GS2SLS – HET. We found that urban land mixture, locate far from Metro cable and equipments have a positive impact over housing prices, while houses far from main roads suffer a negative effect on their prices. Furthermore, distance from Metro, downtown and BRT stations do not have a homogeneous impact over housing, such that, we did not get conclusive MWTP estimations respect to those urban attributes. Neighborhood features as population density and socio-economic stratum have the expected impact, in this sense, more populated and poor neighborhoods present the lower housing prices while those with opposite features have higher housing prices. In the same line, neighborhoods with higher rate of people with college degree present higher values over same with lower with educated people. Finally, we do not find evidence about the impact of presence of elder and black people. |
| Keywords: | housing prices, real estate markets, Spatial econometrics – Hedonic models, HAC estimation, HET correction |
| JEL: | R31 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:cat:dtecon:dt201510&r=all |
| By: | L. Bryant |
| Abstract: | Purpose - This paper empirically examines the effect of developer charges on housing affordability in Brisbane, Australia. Developer paid fees or charges are a commonly used mechanism for local governments to pay for new urban infrastructure. Despite numerous government reports and many years of industry advocacy, there remains no empirical evidence in Australia to confirm or quantify passing on of these charges to home buyers. _Design/methodology/approach - This research applies a hedonic house price model to 4,699 new and 25,053 existing house sales in Brisbane from 2005 to 2011. Findings - The findings of is research are consistent with international studies that support the proposition that developer charges are over passed. This study has provided evidence that suggest developer charges are over passed to both new and existing homes in the order of around 400%. _Research limitations/implications - These findings suggest that developer charges are thus a significant contributor to increasing house prices and reduced housing affordability. Practical/Social Implications: By testing this effect on both new and existing homes, this research provides evidence in support of the proposition that not only are developer charges over passed to new home buyers but also to buyers of existing homes. Thus the price inflationary effect of these developer charges are being felt by all home buyers across the community, resulting in increased mortgage repayments of close to $1000 per month. Originality/value - This is the first study to empirically examine the impact of developer charges on house prices in Australia. These results are important as they will inform governments on the outcomes of growth management strategies on housing affordability, providing the first evidence of its kind in Australia._Keywords - Housing affordability, developer charges, impact fees, house prices, growth management |
| Keywords: | Developer Charges; Growth Management; House Prices; Housing Affordability; Impact Fees |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_294&r=all |
| By: | P. Elliott; C. Warren; J. Staines |
| Abstract: | As municipal governments continue to implement historic preservation regulations, it is vitally important to understand the effects on the designated properties and the housing market. Determining and understanding the impact is important for property owners, buyers, planning authorities and valuers. Whilst it is known that historic preservation designation has an effect on property value, the effects are mixed and unclear. The direction and magnitude of the effect is dependent on locational factors, regulatory, structural, and housing market variables. Literature has extensively examined the effects that historic preservation designation has on the value of residential property in Europe and the United States. This is the first study conducted in Australia that investigates the economic effects of Demolition Control Precincts (DCPs). This research examines the housing market. The theoretical model draws upon urban planning theory and housing economics in the context of an Australian housing market, the City of Brisbane. It was hypothesised that, DCPs reduce the supply of residential vacant land, causing a degree of scarcity. The demand for residential vacant land in DCPs is inelastic, creating market segmentation. It was hypothesised that this segmentation results in residential vacant land in DCPs selling for a premium over comparable vacant land not located in DCPs. Results from hedonic price regression models validate the research model and provide several insights. Key findings are that Brisbane’s residential vacant land market is segmented, due to a scarcity of vacant land in DCPs. Vacant land within DCPs exhibits inelasticity of demand. Vacant land located in DCPs sell for a price premium of 11 percent, over comparable vacant land located outside of a DCP. Consistent results are found across all locations of Brisbane, including inner and outer suburbs. Â The thesis has procedural and substantive policy implications. Planning authorities must find an appropriate balance between historical preservation and urban development. Property valuation of residential vacant land and houses requires recognition of housing market segmentation and price premia. |
| Keywords: | Demolition Control Precincts; Impacts; Property Value |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_273&r=all |
| By: | Iwata, Kazuyuki; Managi, Shunsuke |
| Abstract: | This study advocates a multi-dimensional urban planning strategy to help combat climate change under local—and not national—policies. However, the literature does not provide adequate guidance to local governments seeking to enhance urbanization and in turn reduce vehicular carbon dioxide (CO2) emissions. Therefore, this study sheds light on the effects of the following four urban planning instruments on vehicular CO2 emissions: urbanization promoting areas, urbanization control areas, urban planning taxes and property taxes. Using Japanese city-level data from 1990 to 2010, we find that the two urbanization area planning instruments and the urban planning taxes help lower emissions by increasing population density in low-density cities and that property taxes help reduce emissions in high-density cities. However, the increased population density associated with these instruments can lead to other negative outcomes, including increased traffic accidents, increased crime and a decrease in the facility condition index. City governments should consider complementary policies to mitigate such negative outcomes when employing planning instruments aiming to increase population density. |
| Keywords: | urbanization, population density, land use taxes, land use regulations, carbon dioxide emissions, multiple outcome |
| JEL: | Q58 R52 R58 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66435&r=all |
| By: | D. Barentsen; P. Koppels; H. Remøy |
| Abstract: | Built cultural heritage is generally believed to be an important urban amenity that influences the attractiveness of cities as place of residence and business location. However, while the provision and maintenance of cultural heritage is costly and relatively easily estimated, the benefits arising from cultural heritage are much harder to quantify. Consequently, historic buildings have been demolished because the costs of adopting them for new use were estimated to outweigh the possible price premium related to the historic nature of the building. Quantification of the benefits of cultural heritage might provide an additional incentive and justification for public and private parties to preserve and maintain the stock of built cultural heritage. In this paper, the value effect of cultural heritage is analysed in two ways: the price effect of listed status on the market value of dwellings is investigated; and possible externalities – spillover effects – of listed buildings on nearby property values are explored. For this purpose several specifications of hedonic price equations are estimated to determine whether a listed building status yields a price premium and if proximity to listed buildings is capitalised in property values. |
| Keywords: | Adaptive Reuse; Hedonic Pricing; Heritage; Housing |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_257&r=all |
| By: | C. Hannum; K.Yavuz Arslanli |
| Abstract: | This project will build a theoretical model of real estate brokerage using assumptions based upon findings from the extensive brokerage literature. In this model differentiation in services and quality between brokerage firms combined with differentiation in preferences between sellers lead to measurable ranges of operation for brokerage firms. These ranges overlap, leading to the competitive nature of the industry. This theoretical model can be simulated in order to predict when ranges will grow or shrink and when competition within them will increase or decrease. Using MLS data for Northern Colorado we will measure the range of operation in ArcGIS for each brokerage firm and each agent in the sample by using actual geocoded data for listings and transactions. These ranges of operation will be used to calculate a market share of listings or transactions for the agent or brokerage firm within their own range of operation. For example, while a county might have 1200 listings a certain brokerage firm within that county may compete only within a smaller area of that county in which there are 120 listings. If the brokerage firm has 40 total listings our methodology would give them a market share of 33% within their operating range rather than 3% within the county. Market share measures for individual agents and brokerage firms will be combined to generate a market concentration measure for larger predefined areas such as cities or census blocks akin to the Herfindahl-Hirschman Index. This will be done using a weighted average, using conventional market share measures (the aforementioned 3%) for weights. Using panel data techniques we will test whether higher values for our market concentration measure are correlated with higher or lower sales prices. We will examine whether market shares and the size of operating ranges for individual agents and brokerage firms vary predictably with local market conditions. These tests will help to determine what value better measures of brokerage firm market share and market concentration will have to policy makers and real estate practitioners, potentially in identifying desirable locations for new entrants and in predicting future trends. |
| Keywords: | Brokerage; Spatial Analysis |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_79&r=all |
| By: | G.Petru Multescu; A. Daugeliene |
| Abstract: | Building cities capable to withstand adverse conditions generated by climate, environmental, resource- or community-driven vulnerabilities is part of a global response aiming to strengthen our cities through enhancing their adaptive capacity of reaction. However, world city rankings identified above do not address specifically enough a modern-day threat to our cities: economic disasters. Sustainable urban development and resilient urban economies depend on the strength of property markets and subsequent construction sectors. The 2008 credit crunch and subsequent economic recession have had a devastating impact on some of the European property markets. Some of the Central Eastern European (CEE) emergent markets have been mostly affected by a chronic lack of finance, poor government and governance and high perception of risks and vulnerability to investors in real estate. Property markets instability has affected local economies, local communities and urban and regional development. Institutional investors and market analysts are aware of the prospect of another potential property market crisis within the next decade. In the current weakened EU economic context growth has been limited and austerity measures have come into strong conflict with economic investment requirements. Developing a set of factors that contribute to property market resilience to economic cycles and future recession should therefore become a priority for the local governments and investors in Europe. How can emergent property markets become more resilient and what are the lessons that emergent property markets can learn from developed property markets in order to enhance their adaptive capacity of reaction to economic disasters? The research aims to develop a model for appraising property market resilience in European capital and regional cities. Developed property markets were analysed in order to establish specific factors that helped them become more resilient to economic disasters. Lessons to be learnt and mistakes to be avoided are considered for the development of more resilience as part of CEE emergent property markets. Establishing a successful model for appraising resilience in emergent and developed property markets will ultimately help with establishing a long-term European capital and regional city index of property market resilience as a tool for managing urban resilience to future economic disasters. |
| Keywords: | Central Eastern Europe; City Resilience; Emergent Property Markets; Property Cycles & 2008 Crisis; Property Markets Resilience |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_179&r=all |
| By: | M. Kaya; F.Gezici Korten |
| Abstract: | The term real estate has exerted direct impacts on the urban finance and macro-form in changing economies of the world cities. This paper examines the urban dynamics of İzmir as candidate for brand city which explain how the city has developed by major projects. Izmir has been famous as a trade center ever since its past history. In recent years, most of the efforts have been made to make the port city famous in service facilities again. The aim of the paper is to analyze the development process of central districts within the city of Izmir and to examine the role of real estate projects. During the time of ever-increasing uncertainty, a question gets more pertinently than ever: Will the main three districts maintain the reliability of the city economy in equilibrium through new planned service-based functions. Therefore a survey was conducted including interviews with the project developers who operated major investments in Konak, Bayraklı and Karşıyaka districts. The decision-making and implementation process, and challenges to become the central districts are related flexible, adaptable and fast-changing economy. The findings of the research put forward that the interest of the capital and the basic strategies of the plans and investments do not overlap. After strategic regional land use plan and other upper scaled plans have been realized, developers are expecting that the study area will attract significant real estate projects which have mixed use functions with various forms._Originality/value - This is the first paper to examine urban dynamics of the centers in İzmir from the perspective of real estate development for better understanding to relationships between brand city vision, urban macro-form and major projects. |
| Keywords: | Brand City; Major Projects; Real Estate; Transformation; Urban Centres |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_118&r=all |
| By: | M. Kryvobokov |
| Abstract: | In the French-speaking Belgian region of Wallonia, one third of households rent their accommodations. Three thirds of them represent private rental sector. Taking into account the important size of this sector and recognizing the weakness of the existing state of data collection, the administration of the Walloon Region has recently decided to create a system of residential rent observation. The detailed and updated information about housing attributes and rents should be used in housing policy revision, including more transparent rent estimation in private rental sector. The Center for Sustainable Housing Studies is responsible for the statistical and methodological management of this system. The first wave of the observation system includes 2,500 face-to-face interviews among the private renters in the arrondissements of Nivelles and Charleroi. While the former represents to large degree the rich suburbs of Brussels, the latter is a mainly urbanized area well-known by its chronical problems of poverty, high crime rate and low quality of housing. In both arrondissements, it was asked 3.6% of households renting their accommodation in private sector._ _Though in hedonic regression literature the analysis of housing rents is rather rare, it is applied more and more often in recent years. In our study, a hedonic model of housing rents is constructed with internal and geographical attributes as explanatory variables. Neighborhoods are included in the equation as dummies. The aim of the study is to find which mode of data treatment provides better model performance and out-of-sample prediction: an overall model with all observations or market segments at the spatial level of the contrasting arrondissements (or at a lower spatial level). Spatial and geographically weighted regression methodologies are applied. |
| Keywords: | Hedonic Model; Housing Rent; Market Segmentation; Rent Observation; Wallonia |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_20&r=all |
| By: | R. Rodriguez |
| Abstract: | In this paper we have developed a VEC model to capture long term equilibrium trends as well as short term dynamics of the residential prices of the Spanish market. A parsimonious model has been selected, based on economic fundamental variables, explaining supply and demand interplay in the period 1995-2012 with quarterly observations. GDP per-capita, mortgage rate, Gross capital formation in dwellings and building starts have proxied demand, supply and opportunity costs. Insights on the impact of these variables on residential prices have been brought to light as well as the speed of adjustment once the price deviates from the long term equilibrium. Our model suggests that the Spanish residential prices adjust relatively fast, with around 22% of the deviation of the long term trend corrected each quarter. Furthermore, house prices are mainly driven by income (GDP per-capita) while impacts on prices are less important if come from variations in mortgage rates or stock changes.The time span used has conveniently allowed us to analyze the market in the recent residential price bubble context. As expected, during this period market rationale drifted from economic fundamentals and shock conditions sprang. Therefore, in our model we successfully identify structural break conditions since early 2008, instance when the residential prices busted in Spain. For this study a comprehensive database of real estate variables has been constructed for the Spanish market. 52 variables (six of them correspond to different definitions of housing prices) have been collected offering a pool of 46 candidate regressors to explain residential prices. In this context we have tried methods of automatic modelling selection using Genetic Algorithms (GA). Preliminary results point to similar results to the structural modelling. Different specifications obtained tend to render the same variables set, including purchasing capacity, opportunity costs measures and housing stock. With some definitions of prices, demographic and credit conditions are added to our structural specification. |
| Keywords: | Cointegration; Forecasting; Residential Prices; Spain; Vecm |
| JEL: | R3 |
| Date: | 2014–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_108&r=all |
| By: | M. Lippi Bruni; I. Mammi |
| Abstract: | Geographical clusters in health expenditures are well documented and accounting for spatial interactions may contribute to properly identify the factors affecting the use of health services the most. As for hospital care, spillovers may derive from strategic behaviour of hospitals and from patients’ preferences that may induce mobility across jurisdictions, as well as from geographically-concentrated risk factors, knowledge transfer and interactions between different layers of care. Our paper focuses on a largely overlooked potential source of spillovers in hospital expenditure: the heterogeneity of primary care providers’ behaviour. To do so, we analyse expenditures associated to avoidable hospitalisations separately from expenditures for highly complex treatments, as the former are most likely affected by General Practitioners, while the latter are not. We use administrative data for Italy’s Region Emilia Romagna between 2007 and 2010. Since neighbouring districts may belong to different Local Health Authorities (LHAs), we employ a spatial contiguity matrix that allows to investigate the effects of geographical and institutional proximity and use it to estimate Spatial Autoregressive and Spatial Durbin Models. |
| JEL: | I11 R12 C23 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp1027&r=all |
| By: | J. Bakens; G.B. Pryce |
| Abstract: | In this paper we describe the role of ethnicity in spatial patterns of mover _flows in Scotland by focusing on the ethnicity of movers in relation to the ethnic composition of neighbourhoods. Many cities are becoming more and more ethnically diverse. Within cities however, neighbourhood population composition might not always reflect this diversity as clustering, segregation, but also mixing of ethnic groups predominantly takes place on lower spatial levels. For individual residents, the ethnic population composition of a neighbourhood might therefore become an increasingly distinctive and important feature for the comparative evaluation of residential locations. If the ethnic population composition of a neighborhood plays a role in individual location decisions, compositional preferences are most likely related to one's own ethnicity._Understanding this mechanism in the process of residential location decisions will ultimately help us to better understand ethnic neighbourhood dynamics. For the analysis in this paper, we use a unique combination of datasets on a very fine-grained spatial level. We link the Registers of Scotland house transactions data between 1990 and 2010 with the Scottish Neighbourhood Statistics. The ethnicity of house buyers is identified by (sur)name analysis. There is a rich literature on using onomastics to identify ethnicity, and_this approach can overcome some of the drawbacks inherent in using other ways of identifying ethnicity like, for example, country of birth. Adapting a gravity model of spatial interaction, we model spatial patterns of mover flows of different ethnic groups in Scotland and neighbourhood compositional change. Spatial interaction models offer a systematic approach to describe the role of neighbourhood population composition in determining location patterns of different ethnic groups. |
| Keywords: | Ethnic Mover Flows; Neighborhood Dynamics |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_184&r=all |
| By: | I. Gostautas |
| Abstract: | The study investigates whether electricity consumption could be a valuable data supplement in analysing house value variations within the city. Electricity consumption is a proxy for economic and citizen activity, wealth, population size, density, and to a certain extent habits of the residents. In general, electricity could substitute many factors that are essential in real estate markets. The study investigates real estate market in London by employing a panel of electricity consumption and house price data of 32 boroughs from 2003 to 2014. The data enables to examine cross-sectional and temporal links using several panel models. Additionally, robustness of outcomes are tested. The findings indicate that there is a negative correlation between domestic electricity consumption and average house values, suggesting that owners of more expensive houses consumes less electricity. On the other hand, boroughs that consume more non domestic electricity are positively related with the average house values in the area, suggesting that homes are more expensive in more active areas. Electricity consumption could supplement data used in real estate market analysis. The electricity consumption data is precise, rapidly obtained, and could be gathered frequently without high cost, contrary to population and economic activity statistics. At the same time electricity consumption may help analyse the characteristics of an area that are difficult to quantify and expensive to collect. To the authors’ knowledge, there is no other study that investigates interconnection between electricity consumption and real estate market. By using the electricity consumption, house price trends could be quantified more precisely, thus producing a city profile that paints a more realistic picture for the market participants. |
| Keywords: | Electricity Consumption; House Prices; London, UK; Panel; Please Select Below |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_256&r=all |
| By: | M. Schier; M. Voigtländer |
| Abstract: | Real estate prices increased markedly in Germany, in particular in metropolitan areas. These increases lead to the conjecture/presumption that speculative bubbles are developing, similar to those in Spain or Ireland in 2007 and 2008. Based on a user cost of housing approach it is shown, that for most German districts the recent price changes can be ascribed to fundamental factors and are not driven by speculative behavior. The increasing prices can rather be interpreted as a catch-up process, especially because real estate prices did not rise the decade before. Modelling different price and interest rate scenarios support this explanation. Even a sudden and pronounced surge in interest rates would give scope for a sharp price correction, which is typical for a bursting bubble. Thus, the probability of an imminent real estate bubble is rather low. The low interest rate could rather change housing consumption in general and lead to fundamental structural changes in the German real estate market as homeownership becomes more attractive in comparison to renting. |
| Keywords: | Germany; Real Estate Bubbles; User Costs Of Housing |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_115&r=all |
| By: | W.A. Brunauer; W. Feilmayr; R.S. Weberndorfer |
| Abstract: | In this paper a new residential property price index (RPPI) for Austria a socalled Ã’spatial imputation indexÓ is presented. The basic principle of this index is to evaluate hedonic price models over all census tracts in Austria for representative bundles of characteristics and to compare the results over time. By this it is possible to aggregate on arbitrary spatial scales above census tract levels, taking into account various perspectives on the housing market by applying different weighting schemes for aggregation. Methodologically, we use Generalized Additive Models (GAM), which account for possibly nonlinear functional relationships using regression splines and for unexplained spatial heterogeneity (beyond what can be explained by location covariates) using random effects. The paper gives an overview over the methods and variables used for the hedonic models and provides examples for the regional index on census tract levels all over Austria. The results of the aggregated index are further used by the Austrian central bank. |
| Keywords: | Generalized Additive Model; Hedonic Index; Nonlinear Regression; Random Effects; Spatial Imputation |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_119&r=all |
| By: | Paolo Surico (London Business School); Clodomiro Ferreira (European University Institute); James Cloyne (Bank of England) |
| Abstract: | In response to an unanticipated change in interest rates, households with mortgage debt adjust markedly their expenditure, especially on durable goods, renters react to a lesser extent and outright home-owners do not react at all. All housing tenure groups experience a significant change in disposable income (over and above the direct impact on mortgage repayments). The response of house prices is sizable, driving a significant adjustment in loan-to-income ratios but little change in loan-to-value ratios. A simple collateral constraint model augmented with durable goods and renters generates predictions consistent with these novel empirical findings and suggests that heterogeneity in housing debt positions plays an important role in the transmission of monetary policy. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:629&r=all |
| By: | Sofia Dokuka (National Research University Higher School of Economics); Diliara Valeeva (National Research University Higher School of Economics); Maria Yudkevich (National Research University Higher School of Economics) |
| Abstract: | Peer group effects show the influence of student social environments on their individual achievements. Traditionally, a social environment is considered by researchers of peer effects as exogenously given. However, significant peers that affect performance are often those that are deliberately chosen. Students might choose their friends among peers with similar academic achievements. A dynamic analysis of student social networks and academic achievements is needed to disentangle social selection and social influence processes in network formation. Using data about the friendship and advice networks of first year undergraduate students, we show that friends tend to assimilate each others’ achievements and choose advisers with similar grades. We explain these results by social segregation based on student performance. The article contributes to the dynamic analysis of student social networks and the understanding of the nature of peer group effects in education |
| Keywords: | social networks, academic achievements, peer group effects, higher education |
| JEL: | D85 I21 I23 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:65/soc/2015&r=all |
| By: | S.Vieira Gomes; T. Florentino |
| Abstract: | The concerns on the preservation of the natural environment have focus mainly on large ecosystems protection. These areas are usually distant from the urban environment, where only relatively smaller natural spaces can survive. These small-scale green areas are often disregarded, when compared with the large ones, and many of their benefits are diminished. However, the urban nature provides important social and psychological benefits to human societies, which enrich human life. They provide spaces for social interaction, enhancing the community cohesion, while contributing for a healthier lifestyle. Another advantage is related to the air quality improvement and climate protection due to their ability to store carbon. Although public preferences for environmental attributes may vary among individual citizens according to their socio-economics characteristics and daily activities, these benefits are well recognized by most citizens, having clear consequences on housing choices. Furthermore, green spaces may be used as factors to increase the attractiveness of a city, by making the city green and pleasant. The main concern of this paper is to address the importance of green areas for the urban citizens, and to analyze their distribution in consolidated cities. A case study for the city of Lisbon, Portugal is presented, where spatial distribution, distance from residential areas and population satisfaction is analyzed, amongst other indicators. |
| Keywords: | Air Quality; Quality of Life; Urban Parks |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_183&r=all |
| By: | Dan S. Rickman (Oklahoma State University); Hongbo Wang (Oklahoma State University); John V. Winters (Oklahoma State University) |
| Abstract: | Using the 3-year sample of the American Community Survey (ACS) for 2009 to 2011, we compute public school teacher salaries for comparison across U.S. states. Teacher salaries are adjusted for state differences in teacher characteristics, cost of living, household amenity attractiveness and federal tax rates. Salaries of non-teaching college graduates, defined as those with occupations outside of education, are used to adjust for state household amenity attractiveness. We then find that state differences in federal tax-adjusted teacher salaries relative those of other college graduates significantly affect the share of education majors that are employed as teachers at the time of the survey. |
| Keywords: | teachers, teacher salaries, teaching profession, teacher retention |
| JEL: | H75 I20 I28 J24 J31 R23 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:okl:wpaper:1504&r=all |
| By: | L. Yao; M. White; A. Koblyakova |
| Abstract: | Housing affordability distinguishes ‘need’ and ‘access’ as the key criteria to examine the ability of the households to enter the housing market or transit into homeownership. Housing affordability was broadly considered as the relationship between housing and non-housing expenditures, which examines the ability of households paying for a house without breaking current living standards or falling into poverty. In the context of economic transition and housing reform in China a fully market-oriented housing market has developed. The expansion of the residential housing market has been accompanied with house price appreciation and inflation, accelerating urbanization, and a rising demand for housing. These changes have led to affordability problems, particularly for low and middle-income groups. Recent research on housing affordability has shifted from estimating affordability indices to policy debates of granting housing and social welfare subsidies. This paper examines the magnitude of Chinese households’ housing affordability issues since the early 1990s, on the basis of the most common measures of housing affordability. It combines ratio approach with demographic factors, household formation and financial constraints in estimation. Tenure choice refers to households' housing decision under the constraints of financial ability to choose owner-occupied or live in renting houses. The paper then employs affordability estimation results and analyses how these impact tenure choice decisions. The model not only employs aggregate level data from Statistical Yearbook, but also uses Household Survey data to reflect households’ affordability situations in China. With respect to the results, this paper tries to propose further policy measures regarding housing affordability and insufficient housing subsidies. _ |
| Keywords: | Households; Housing Affordability; Tenure Choice |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_44&r=all |
| By: | Basit Zafar (Federal Reserve Bank of New York); Theresa Kuchler (NYU Stern School of Business) |
| Abstract: | We use novel survey panel data to estimate how personal experiences affect expectations about aggregate economic outcomes in housing and labor markets. We exploit cross-sectional and time series variation in differences in locally experienced house prices to show that respondents systematically extrapolate from personally experienced home prices when asked for their expectations about US house price development. In addition, higher volatility of locally experienced house prices causes respondents to report a wider distribution over expected future national house price movements. We find similar results for labor market expectations, where we exploit within-individual variation in labor market status to estimate the effect of own experience on national labor market expectations. Personally experiencing unemployment leads respondents to be significantly more pessimistic about future nationwide unemployment. Extrapolation from personal experiences is more pronounced for less sophisticated individuals for both housing and unemployment expectations. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:678&r=all |
| By: | A. Kashyap; J. Berry |
| Abstract: | The capitalisation of transit access in property values has long been investigated by property researchers and policy analyst. A premium in property price induced by transit services measures the rate of capitalisation and indicates positive impact of transit investments, which can be used to develop transit-based policies such as value-capture and transit-oriented development strategies. Land development impacts of mass transit have long been studied in the developed economies. Yet relatively little is known by the outside world about the Indian experience due to India’s rather short history in the development of mass transit and real estate market. This paper attempts to fill the gap by presenting evidence from India, with a detailed case study of Jaipur Metro Rail Corporation by selecting two transit lines in Jaipur, the study examined land development context and estimated hedonic housing price models to measure the proximity premiums associated with these metro lines. The empirical evidence shows that investments in mass transit can have significant and positive impacts on land development. Properties with transit proximity enjoy sizable price or value premiums. The research findings underscore the importance of introducing zoning and other land regulatory changes prior to the initiation of transit projects as well as applying value-capture tools to help finance investments and redress inequities. |
| Keywords: | Capitalisation; Land Development; Property Values; Transit; Value capture |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_266&r=all |
| By: | K. Wellner; F. Landau; C. Müller |
| Abstract: | Berlin is a growing city. Almost 48,000 people permanently moved to Berlin in 2013, and the number of national and international tourists is constantly rising: 30 million tourist overnight stays are expected in over 700 tourist accommodations in 2016. This massive influx of people challenges the existing built capacities, leading to a tense housing market with increasing rents, selling prices and standard land value, especially in attractive inner-city neighborhoods. The politicization of real estate development and rent prices has produced several regulatory housing policy measures such as the increase of the land purchase tax (2014), Subpoena on the Prohibition of the Misuse of Living Space (2014), and Rent Control (2015). The development of Berlin’s real estate market into one of the most attractive capital investment markets took place at unprecedented speed: inter alia, the transformation of rental property into condominiums or the transformation of residential into commercial usages, vacancy rates have decreased to around 2 percent today. These developments have resulted in a strongly articulated demand for new (residential) constructions requesting about 20,000 additional dwelling units in Berlin. In a four-field-matrix developed elsewhere (Landau/Wellner, 2014), the variable of ‘tourist accommodations’ (TA) is being examined as influential factor on the changing residential quality in inner-city residential neighborhoods in Berlin, where tourism has an increasing impact on both economic development as well as on social cohesion. Tourism has evoked resentment and protest amongst some residents of areas that are heavily frequented by tourists. The variable TA is divided into an official or formalized accommodation segment, i.e. hotels and hostels, as well as an informal sector, i.e. privately-rented sublets or vacation rentals whose number is estimated at 12,000 in all over Berlin. The dimensions of residential quality will be differentiated into built features (location, quality of building etc.), economic (rent level, tenant mix etc.), social (neighborhood atmosphere, security, fluctuation etc.), ecological and health-related (noise, pollution etc.) aspects, thus contributing to the conceptualization of ‘residential quality’. |
| Keywords: | Housing Economics; Housing Policy; Rent Prices; Residential Quality; Tourism |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_116&r=all |
| By: | I. Nase |
| Abstract: | This paper exploits recent developments in spatial econometrics to investigate local authority level house prices in England. It extends upon previous related studies in three ways. First, the research overcomes the hurdles related to boundary changes by focusing on a ten year dataset for the period 2004 -2013. This is enabled through rigorous and systematic data mining to enable analysis at the current level of 326 English local authorities (unitary and districts). Second, based on urban economic theory, the model is expanded (with regard to previous studies) to include economic and social variables. Finally, various specifications of the weight matrix are tested for different levels of spatial dependence and theoretical insights from the fields of regional and urban economy. |
| Keywords: | Average House Prices; English Local Authorities; Spatial Dependence |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_246&r=all |
| By: | Y. Kochetkov; E. Grebenuk |
| Abstract: | To date, the theory of housing market cycles is not well developed. Clearly, even in general case the development of the models for cycle analysis involves numerous interrelated and unresolved theoretical problems. As for Russia, we face a lot of additional problems – lack of reliable data, existence of calculus in two types of currency for real estate market, high influence of government decisions and regulations on supply and demand. Anyway, residential property cycles exist in Russia cities and could be detected and investigated by various methods.For large cities of Russia (Moscow and St.Petersburg) extensive data for housing market have been accumulated and processed. In this paper, we explore the following data: asking prices for apartments since 2000 year, sales volumes, number of apartments on display at the market, share of mortgage in sales, information about starts of new construction, etc. Using a panel of 15 year, we examine the formation of housing market cycles, behavior in inflection point, their amplitude and period.The paper contributes to our understanding of housing market cycles in Moscow and St.Petersburg in two ways. First, we found high influence of real macroeconomic variables on market. The analysis suggests that results from the housing market should be evaluated in the context of the overall economy’s performance. Second, we discover the existence of short-term cycles in price dynamic, inherent to own real estate market. The period of cycles is about 27 months in 2000-2009 and up to 40 months in 2009-2014. Presumably, unusual turnaround took place in the residential market during 2008-2009 years crisis. It would be noted the nature of the impact of fundamentals on residential market changed in 2008/2009 too.Will be considered separately hypothesis about the formation of the 18-year cycle, where shot-term cycles are the part of general 18-year process. |
| Keywords: | Market Modelling; Real Estate Cycles; Time Series |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_124&r=all |
| By: | P.Taltavull de La Paz; F. Juarez |
| Abstract: | This paper reconstruct the long term serie of housing prices in Spain (aggregate) using statistical methods based on ARIMA models. It build the data for sixties until eighties period in quarterly basis, of weighted house prices for the Spanish aggregate and some selected regions. The method uses 2 proxies for house prices reconstruction, the GDP and Mortgage units, and base the built series on the housing market fundamentals. After that, the paper compare the Spanish housing prices with other long term series available like the UK, France, US, Germany, Netherlands, Italy and Japan. The reconstruction shows the different effect that the inflation process occurs during seventies had on housing prices and the similarities of global cycles among European countries. |
| Keywords: | Arima Models; Housing Prices; Spain |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_239&r=all |
| By: | M.Akif Levent; S. Adil; A. Gokbayrak |
| Abstract: | In Istanbul, existing built up areas are threat against many natural and urban risks. Concurrently, these urban spaces have often economic, social and physical scarcities. There is a necessity for urban transformation projects in these slum areas to meet today’s urban space needs also to provide a livable city. Built & Transfer & Evacuate model was developed to realize these urban transformation projects. Built & Transfer & Evacuate is a model that can be used on empty, state-owned urban development areas. Any essential public areas such as green areas, regional parks, public health facilities, educational facilities etc. can be planned in these urban spaces within the master plans for these areas. Due to the model, the buildings those built on the state-owned areas will be bartered for the existing risky buildings which are in the nearest areas. After demolition of the buildings in these areas new master plan studies will be done on the risk-free ones to provide a sustainable urban transformation. Therefore, planned, livable urban spaces will be created. To define the contribution values of the property owners in urban transformation areas, real estate valuation studies should be done. In general, the value of the existing and new built buildings had defined to state the distribution value of the project. Before the master plan and design studies, land-real estate valuation studies should be completed to have the most suitable functions for the areas and to have the best localization of them within the defined criteria. |
| Keywords: | Built - Transfer - Evacuate Model; Istanbul; Real Estate Valuation; Urban Transformation |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_262&r=all |
| By: | S. Copiello; P. Bonifaci |
| Abstract: | To deal with the recession of the global economy since 2008, the financing of programs relating to strategic infrastructure and facility could provide a significant boost to a renewed growth. Despite this perspective, the conditions of public finances, especially in the EU countries, allow recourse to government intervention only in exceptional and temporary basis. Owing to the limited availability of public funds, the further diffusion of Public-Private Partnership (PPP) appears to be a viable strategy to implement investment projects. Nevertheless, in the Italian context as in other parts of Europe, the PPP initiatives have been progressively slowed down, over the past few years, by unfavorable conditions emerged in capital markets. The framework outlined so far is further complicated by the changing needs expressed by community. During the recent past, concessions and project finance have been extensively used to build and manage transport infrastructure and hospitals. Since the past few years new priorities are emerging, such as the refurbishment of social housing stock, the supply of new homes at prices or rents affordable for low income households, as well as the rehabilitation of public buildings intended for administrative offices or schools. Aim of present research is to examine whether buildings energy efficiency measures positively affect the feasibility of social housing projects. This implies the need to investigate the extent of the savings on operating costs, achievable with interventions targeting the buildings energy efficiency, and the contribution they are able to provide to the viability of Public-Private cooperation projects, especially in the field of social housing. Therefore, a case study analysis is performed by comparing a number of ongoing experiences in major cities of northern Italy. Empirical findings highlight structural changes concerning the partnership model. First of all, a new group of players emerges. Interventions are no longer promoted by construction companies or by facility management ones. The new stakeholders are bank foundations and real estate investment funds. Furthermore, public contribution's forms are reinventing themselves, with a reduced incidence on the investments. Within this framework, the achievement of high energy efficiency standards appears to be a relevant feasibility driver for interventions designed to satisfy social housing needs, particularly those to be implemented by means of PPP. |
| Keywords: | Buildings Energy Efficiency; Public-Private Partnership (PPP); Social Housing |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_2&r=all |
| By: | C. Pitros; Y. Arayici |
| Abstract: | Purpose -Â The purpose of this paper is to provide a decision support model for the early diagnosis of housing bubbles in the UK during the maturity process of the phenomenon. Design/methodology/approach -Â The study adopts a positivist approach utilising several parametric statistical tools to support the usefulness of normal distribution theorem to bubble detection. The strategy of this study involves case study analysis by relying on the UK housing bubble periods of _1986-1989 and 2001/2-2007. The research process for the model development is divided into four stages. The first stage includes the identification and verification of the selected variables. The second focuses on the key constructs of the model. The third stage identifies the model's diagnostic rule and proposes the model. The fourth stage includes the tests of the model through the implementation of the case studies. Findings - The findings of the model reveal that the period of 1986-1989 and the period of 2001-2006 were bubble periods for the UK housing market at a 95% confidence interval. At 90% confidence the model reveal that the UK housing market was in a bubble for the periods between 1986-1989 and 2001-2007. The study further founds that for uncovering housing bubbles in the UK house price changes have the same weight with the debt-burden ratio when their velocity is positive. The application of this model has led us to conclude that the model’s outputs are fluctuated in line with the phases of the UK real estate cycle. Originality/value -Â This paper is amongst the few studies that propose a model for identifying housing bubbles in the UK and the first to be based purely on the acceleration rate of the model input. This is also the first study that attempts to hierarchize each variable on the basis of which variables accounts better the presence of housing bubbles. This paper will help researchers and professionals (i.e. appraisers) to better understand the 'risk' associated with the presence of bubbles in the UK housing market. |
| Keywords: | Housing Affordability; Housing Bubbles; Normal Distribution; Uk Case Study |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_37&r=all |
| By: | Hege Marie Gjefsen; Trude Gunnes (Statistics Norway) |
| Abstract: | We exploit a nested school accountability reform to estimate the causal effect on teacher mobility, sorting, and student achievement. In 2003, lower-secondary schools in Oslo became accountable to the school district authority for student achievement. In 2005, information on school performance in lower secondary education also became public. Using a difference-in-difference-in-difference approach, we find a significant increase in teacher mobility and that almost all non-stayers leave the teaching sector entirely. The impact is larger on high-ability teachers following the second part of the reform. Non-stayers are largely replaced by high-ability teachers, indicating a positive sorting effect. We find a small, positive effect on student achievement after the second part of the reform, thus the mechanism in place seems to be positive teacher sorting rather than teacher incentives. |
| Keywords: | school accountability regimes; design of incentives; teacher turnover; teacher quality; teacher sorting; student achievement; difference-in-difference-in-difference |
| JEL: | D03 I21 J21 J38 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:815&r=all |
| By: | Canals, Catalina; Meneses, Francisco; Serra, Camila |
| Abstract: | The present work describes la rate of change of students between schools in Chile during the years 2013 and 2014, and analyses the geographical factors of this change in the metropolitan Region of Chile. The rate of change between schools was of 15,7%, with a similar volume of students moving out and into the public schools. There are important variations in the rate of change at municipality level. The results show that the rates of change are affected by academic performance, SIMCE tests scores, grade, administrative type of school and geographic distribution of schools. The last point suggests that the geographic supply of education has important implications to understand school changes. We see that students increase travel distances with their age and those students that switch schools usually are the ones already traveling longer distances. |
| Keywords: | Cambio de colegio, Estructura de la oferta educativa, Distancia hogar- escuela, Cambio de ciclo. School choice, educational supply, travel distance. |
| JEL: | I20 I24 I28 |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66568&r=all |
| By: | M.Alexander Dietzel |
| Abstract: | Purpose - Recent research has found significant relationships between internet search volume and real estate markets. This article examines whether Google search volume data can serve as a leading sentiment indicator and is able to predict turning points in the US housing market. One of the main objectives is to find a model which can be used to produce real-time forecasts in practice. Methodology - Starting from eight individual real-estate-related Google search volume indices, a multivariate probit model is derived by following a selection algorithm. The best model is then tested for its in- and out-of-sample forecasting ability. Findings - The results show that the model predicts the direction of monthly price changes correctly with over 89 per cent in-sample and just above 88 per cent in 1 to 4-month out-of-sample forecasts. The out-of-sample tests show that although the Google model is not always accurate in terms of timing, the signals are always correct when it comes to foreseeing an upcoming turning point. Thus, as signals are generated up to six months early, it functions as a satisfactory and timely indicator of future house price changes. Practical Implications - The results suggest that Google data can serve as an early market indicator and that the application of this data set in binary forecasting models can produce useful predictions of upward and downward movements of US house prices, as measured by the Case-Shiller 20-City House Price Index. This implies that real estate forecasters, economists and policy makers should consider incorporating this free and very current data set into their market forecasts or when performing plausibility checks for future investment decisions. Moreover, the results could potentially be of value for traders investing in Case-Shiller House Price futures and options. Originality - This is the first paper to apply Google search query data as a sentiment indicator in binary forecasting models to predict turning points in the housing market. |
| Keywords: | Forecasting; Google Data; Housing Market; Sentiment; Turning Points |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_3&r=all |
| By: | C. Lizieri; D. Mekic |
| Abstract: | There is a growing awareness in urban social science of the importance of commercial real estate as a medium by which large cities are embedded within global capital networks. City centre transformations emphasising office development focussed on financial and business services firms tie cities into international employment cycles while the capital sunk into the real estate locks those cities into global capital markets through ownership and finance. This trend is most pronounced in developed world cities whose focus is on financial services. The process has become more marked with the globalisation of commercial real estate markets. RCA data for major office deals 2007-2014 show 35% of those transactions were cross-border. Investment is strongly concentrated: 20 cities account for over 67% of deals by value. Major global investors and international chains of brokers and agents play a key role in this process. While urban research has become more aware of these tendencies, the nuances of market processes are often lost in over-simplistic categorisations such as Ã’international financial capitalÓ or Ã’property developersÓ. There is considerable diversity in the nature of office investors with substantial differences in motivations for building international portfolios and in the impacts of investment for the cities concerned. Further, there is a substantial separation between the process of development and the process of longer term investment that often seems downplayed in academic research. This paper aims to address that gap with a detailed examination of the City of London office market. The study draws on a unique database identifying ownership of offices for over 40 years, allowing analysis of the shift over time from predominantly local domestic ownership to 2014 when over 60% of space is non-UK owned. We analyse changing tides of ownership linked to transformation of the City economy, the data revealing waves of ownership which differ nationally, regionally and by entity type. We trace the new developments in the City revealing the processes that link development and investment activity. These analyses will be placed in the context of employment trends and the investment performance of the City office market in national and global context and draw on evidence of the motivations and objectives of global real estate investors. The paper concludes by examining the implications for the planning, governance and economy of cities. |
| Keywords: | Global Capital Flows; Office Markets; Real Estate Ownership |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_305&r=all |
| By: | M. Topcu |
| Abstract: | This study aims to examine the effects of public or private sector based urban investment on housing values which are in the environs of these kinds of investments. For this purpose, the study uses totally 13 parameters including 5 parameters related the properties of housing structure, 7 parameters related environmental properties and accessibility parameter. At the last 15 years, two regions are in the forefront where urban investments have important impact in Konya which can be seen as a catalyst for the rapid development of the city. For this reason, these areas were chosen as sample. The first sample area is at the north new-developing side of the city. This area has many new investments like shopping mall, gated housing projects, stadium, fairground etc. And, the second sample is at the east side of the city which has also many transformation areas and investments (law court, private university, hospital, urban park, shopping mall, etc). In this context, for measuring the structural and environmental properties of housing units, a total of 200 questionnaire was applied to the housing units by using random sampling technique. Information regarding economical values of housing units was obtained from real estate companies. These derived data were evaluated by statistically. In conclusion, the results from the evaluations showed that building age, housing unit size, density, safety-security, accessibility, having parking lots and having elevator parameters are significantly effective on housing values. |
| Keywords: | Housing Values; Konya; Urban Development |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_311&r=all |
| By: | D. Kulikauskas |
| Abstract: | This paper develops a comprehensive framework for assessing housing price misalignments from the fundamental prices in the Baltic States. For this purpose several statistical indicators (price-to-rent ratio, price-to-income ratio, price deviations from Hodrick-Prescott filtered trend) are used together with econometric models. Such models include reduced form equilibrium price regressions estimated for individual countries and for the panel as well as supply-demand system for each of the Baltic countries. Statistical indicators are employed in combination with the model estimates to arrive to clearer conclusions about residential real estate price misalignments. This paper contributes to the literature by filling the gap of monitoring housing market developments consistently in the Baltics and developing a framework that can potentially be used to monitor price misalignments in the residential real estate markets of other countries. |
| Keywords: | Baltics; Fundamentals; Housing; Prices; Real Estate |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_31&r=all |
| By: | E. Alkay; B. Keskin; C. Watkins |
| Abstract: | There is a strong policy discourse at local and national level in Turkey that ascribes considerable economic benefits to new construction activity. Critics, however, argue that this policy discourse has led to a mismatch between public policy and market fundamentals in many cities. It has been suggested that policy intentions might be driving construction levels above demand levels and could be contributing to uneven spatial development between regions. This paper seeks to shed light on this argument by systematically exploring the relationship between planning policy and development activity in 81 Turkish cities. The analytical framework draws on research undertaken by Bramley and Leishman (2005) and Henneberry et al (2005) on the relationship between public policy and market outcomes and has been adapted to take account of the institutional arrangements and policy instruments operating in Turkey. Drawing on data on economic activity, local social indicators, planning permissions and applications, and demographic change, the paper develops a cross-sectional econometric model that helps isolate the effects of planning policy from other drivers of construction activity. The second stage analysis uses to GIS methods and spatial statistics to develop an understanding of spatial variations in the drivers of development activity. The paper offers some tentative conclusions about the relationship between policy imperatives, market fundamentals and development activity. |
| Keywords: | Planning Policy; Real Estate Development; Spatial Variation |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_193&r=all |
| By: | E. Aydin; D. Brounen; N. Kok |
| Abstract: | The uncertainty regarding the financial return of energy efficiency (EE) investments may be a reason for households not to undertake profitable investments in energy efficiency. Therefore, it is important to identify the market value of energy efficiency in the housing sector. Previous literature provides some empirical evidence on the impact of energy efficiency on sale prices in the building sector. However, the most common methodological drawback of the evidence provided by the available literature is the potential bias that may arise due to the omission of unobserved dwelling characteristics that are correlated with the EE. In this study, using a large representative dataset from the Netherlands, we propose an instrumental variable approach in order to correctly identify the capitalization of energy efficiency in the housing market. We benefit from a continuous energy efficiency measure provided by Energy Performance Certificates (EPC), which enables us to estimate the elasticity of house price with respect to its energy efficiency. As well as including detailed dwelling characteristics in the hedonic model, we use an instrumental variable (IV) approach to deal with the potential omitted variable bias. The 1973-74 oil crisis, which created an exogenous discontinuity in the EE levels of the dwellings constructed before and after this date, and the evolution of building codes are used as instruments for energy efficiency. Our results indicate that the standard OLS estimates are downward biased. By using an IV approach, we find that as the energy efficiency level increases by 50 percent for an average dwelling, the value of the dwelling increases by around ten percent. In order to examine whether the value of EE increases by the disclosure of EPC, we create a common energy efficiency measure for certified and non-certified dwellings, which is based on actual energy consumption. Our findings do not suggest a larger capitalization rate for the dwellings that are transacted with EPCs. Finally, in order to examine the over-time variation in the capitalization of EE, we estimate the hedonic model for each year separately from 2003 to 2011. We document that the value of EE has doubled from 2003 to 2011, which might be partly explained by the increase of energy prices, the relative decrease in house prices. |
| Keywords: | Building Code; Energy Efficiency; Energy Label; House Price; Regression Discontinuity |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_1&r=all |
| By: | W. Feilmayr |
| Abstract: | After a period of more or less stable real estate prices at the beginning of the 21st century, the prices have shown a sharp rise since around 2007 especially in Vienna, the other federal capitals and its surroundings, whereas in the rural areas in the periphery prices even declined. In this paper special attention is paid to alpine and touristic regions. The main differences of these compared to the other regions will be elaborated. Moreover the variables explaining the prices and developments will be identified. Results will be presented for single family houses and for owner occupied appartments. The underlying models use nonlinear hedonic regression methods. The price observations and the attributes of the single real estates stem from different data bases including purchase and offer prices. The neighborhood covariates come mainly from the spatial information system IRIS, which has been developed for all Austrian communities at the institute of regional science of Vienna University of Technology. |
| Keywords: | Alpine Regions; Austria; Hedonic Models; Regional Real Estate Prices |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_107&r=all |
| By: | Mehmet Balcilar (Department of Economics, Eastern Mediterranean University); Rangan Gupta (Department of Economics, University of Pretoria); Stephen M. Miller (Department of Economics, University of Nevada and University of Connecticut) |
| Abstract: | This paper provides out-of-sample forecasts of linear and non-linear models of US and Census regions housing prices. The forecasts include the traditional point forecasts, but also include interval and density forecasts of the housing price distributions. The non-linear smooth-transition autoregressive model outperforms the linear autoregressive model in point forecasts at longer horizons, but the linear autoregressive model dominates the non-linear smooth-transition autoregressive model at short horizons. In addition, we generally do not find major differences in performance for the interval and density forecasts between the linear and non-linear models. Finally, in a dynamic 25-step ex-ante and interval forecasting design, we, once again, do not find major differences between the linear and nonlinear models. |
| Keywords: | Forecasting, Linear and non-linear models, US and Census housing price indexes |
| JEL: | C32 R31 |
| URL: | http://d.repec.org/n?u=RePEc:emu:wpaper:15-27.pdf&r=all |
| By: | S. Roulac |
| Abstract: | Most property practioners are innocent of the prospects for and consequences of innovation, presuming that real estate involvements somehow are exempts from the forces of Creative Destruction and Disruptive Innovation. Notably, two of the most successful IPOs in recent times, AirBnb and Uber have profound real estate implications. The former now accounts for an inventory of lodging facilities larger than any hotel brand. The latter's assault on car ownership could realign spatial patterns, property values, and regional economic status. How innovation threatens established interests and creates new opportunities, and thereby impacts the property markets, is the subject of this paper. The elements of the property process in the context of the supply chain and value chain are examined through the prism of change patterns over time, present vulnerabilities, future consequences and implications. The many facets of the property boxÑits creation, function, placement, productivity, financing, experience, operations, management, profitability, valueÑare considered in the context of the six primary technologies: transportation, information, communications, knowledge/meaning, energy/power, money, that determine the demand for property goods and services and shape our places. This research builds on numerous prior studies by the author of these phenomena, extending over four decades, and integrates the implications of such powerful themes as the Internet of Things, Predictive Analytics, Big Data, Personalization and Customization, SaaS Business Models, Place Competition, Gamification, Amplification, and more. |
| Keywords: | Development; Economics; Innovation; Real Estate; Technology |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_348&r=all |
| By: | C. Ciora; G. Maier; I. Anghel |
| Abstract: | The high spread of green building certification across Europe has become more visible with the new projects that have been built in the last five years. Our main research focus is on the location of green buildings within European cities. We argue that green buildings should cluster in a specific distance from the Central Business District (CBD). Taking into consideration the urban development of cities and specific characteristics of the CBD, our aim is to analyze empirically whether or not this hypothesis is supported by data from European cities. We will use publicly available data for various green building certificates (LEED, BREEAM, DGNB) which give addresses or coordinates for certified buildings and will combine this information with GIS-based information for the respective cities. We will use point pattern analysis in order to find spatial clusters of project in the various cities and relate these results to distance from CBD as well as some basic city characteristics. |
| Keywords: | Green Buildings; Location |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_154&r=all |
| By: | E. Valtonen; H. Falkenbach; K. Viitanen; E. van der Krabben |
| Abstract: | Developing new neighbourhoods, both through greenfield and brownfield projects, is risky business. These kinds of large scale urban development projects can take several decades and contain high amount of both private and public investments. Uncertainty concerning the time table as well as the overall profitability of the projects is obvious. Development industry is usually also highly regulated, at least in the developed economies. Albeit the property rights allowing using, transacting and benefiting from a private property are usually secured by law, the change of a property's use is somehow regulated at the same time. The main argument supporting this regulation is handling the externalities caused by a particular use of a real estate, such as a polluting factory in the middle of a residential neighbourhood. The regulation concerning planning and development differs among countries, although the underlying argument is the same. Our study aims to investigate the planning and development practices with the perspective of risk allocation in urban development projects in Finland, in the Netherlands and in the UK. These countries form an interesting group for comparison because of their differences concerning planning and development, i.e. the countries represent different planning systems according to urban planning literature. The main emphasis in the study is put on the risk positions of the municipalities and private developers in the studied countries. To study the risk position the legislation governing planning and development together with illustrative case examples in each country are analysed. Special attention is paid to the roles of the municipalities and private developers in planning the to-be-developed areas and to the responsibilities of the municipality in the implementation of the plans concerning the infrastructure provision. Together with the infrastructure provision responsibilities it is discussed how the delivery of the infrastructure can be financed. |
| Keywords: | Development; Infrastructure; Planning; Risk; Urban |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_145&r=all |
| By: | Y. Coskun; A. Alp; M. Ertugrul; U. Seven |
| Abstract: | Real estate economy has showed unusual performance in last decade in Turkey. Growing house supply/sales, credit volume, and rising house prices have mostly marked as boom. The perception of housing boom has also raised concerns among local/inernational investors, consumers, and policy-makers. The objective of the paper is to present the findings of the first comprehensive bubble analysis of Turkish housing markets utilizing/comparing several alternative methods. In order to address research questions, the study established two research objectives, 1) To identify characteristic variables of a housing bubble analysis in the context of Turkish housing market, and 2) To emprically measure whether rising house prices have been justified by fundamental factors. The outcomes of the study provides critical knowledges to domestic/international stakeholders of Turkish housing (and real estate) market. |
| Keywords: | House Price; Housing Bubble; Mortgage; Residential Market; Turkey |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_58&r=all |
| By: | Ballesteros, Marife M.; Ramos, Tatum; Magtibay, Jasmine E. |
| Abstract: | The Community Mortgage Program (CMP) is a financing scheme that enables organized residents of slums to borrow for land purchase and housing development. It is considered to be the most innovative and responsive government housing program in the Philippines. Nevertheless, the CMP has a number of weaknesses that have not been given much attention in the years of program implementation. These issues pertain to program targeting, service delivery, and organization. This study aims to review the current processes and overall performance of the CMP including its variants—the localized CMP and the High Density Housing Program. It also provides recommendations on how the identified problems can be addressed. |
| Keywords: | Philippines, housing, informal settlers, community loan mortgage |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:phd:rpseri:dp_2015-41&r=all |
| By: | P. Castanheira |
| Abstract: | The main purpose of this study is to understand how the price of housing is formed in the new ( expo) and old town in Lisbon ( traditional neighborhoods). The study focuses on the prices of the apartments that were sold with the assistance of Estate Agents operating in Lisbon in last 3 years, and how the economic crisis can explain the market price. . For the development of the study, we used two different methodologies: Hedonic Pricing Methods (MPH) and Artificial Neural Networks (ANN). ANN are a less traditional econometric technique from the field of Artificial Intelligence, but they are strong competitors with the MPH. In the last two decades, the MPH has been applied to the real estate market in Portugal but, till the present, no single study is known with the ANN. To obtain the best hedonic model, numerous tests were developed, aiming the validation of MPH and also the adequate selection of variables that contribute most to the prices. The tests were performed with the statistical software SPSS, The explanatory variables included in the final model for the price of an apartment were: the floor area (m2), the garage and basement index, the comfort index, the location index and two other variables resulting of interactions, one between the year of sale and the condition of the apartment (whether it is new or used) and the other between the preservation index and the condition of the apartment. With these six explanatory variables, the MPH has achieved an accuracy quite significant when compared with some previous studies. |
| Keywords: | Artificial Neural Networks; Hedonic Prices |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_227&r=all |
| By: | D. Kavarnou; A. Nanda |
| Abstract: | This study tries to identify whether the most tourism penetrated places are the ones which have the greatest influence in terms of house prices because of tourism. In Chapter 1 we briefly presented the economic, political and real estate framework of the country and particularly this of the islands. In chapter 2, we tested standard hedonic model for the housing markets of the islands which revealed some unique drivers. One of the basic driver, is this of tourism appearing constantly significant across particular islands; so natural question out of that is to look deeper into tourism penetration. By taking Crete Island as a case study, from 2006 to 2012, we firstly structure tourism indicators for each prefecture. Then, by using the principal component analysis, we create the Tourism Penetration Index (TPI) of each prefecture and we rank the four prefectures of Crete from the most tourism penetrated to the least one. The second stage of the analysis we regress the data of the four individual prefectures in three steps: firsly, we regress properties without the TPI effect; secondly, we use the Tourism Penetration Index (TPI) of the first stage corresponding the prefecture and the year to each observation, so as to observe its significance to the house prices of each prefecture. To the last step of the second stage of the analysis, we add to the hedonic models the TPI of the neighbour prefecture(s), so as to identify whether there is any the spill-over effect cause by tourism penetration. The focus here is to identify whether a) the TPIj of a prefecture j is significant on House Prices of the prefecture, b) its significance on House Prices of each prefecture follows the same ranking as in first stage and therefore, whether the most Tourism Penetrated places are the ones whose houses prices have been mostly affected by tourism penetration, c) House Prices are affected by the TPI of the neighbour prefecture (tourism spill-over effect). Models are tested for robustness across several specifications. |
| Keywords: | Crete Island; Housing Prices; Pca - Hedonic Regression Analysis; Tourism Penetration; Tourism Performance |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_64&r=all |
| By: | A. Buyukduman |
| Abstract: | The analysis regarding the housing prices could be made in the light of long-term data. However, because the indexes that have been produced recently in Turkey are limited to a short term, such long-term analysis could not be made. Building backward housing price indexes by analyzing the factors that affect the development of housing prices will bring about the analysis of not only the dynamics of the domestic housing market within the country but also a comparison of housing markets between our country and other countries of the world. The main purpose of this study is to close the gap of the index needed to evaluate the movement of housing prices in the city of Istanbul. For this purpose, the data about the sale and rent prices of houses within a selection of districts of Istanbul between 1988 and 2012, a time span of 25 years was gathered to construct the sale and rent index of houses. Proceeding from this index, the development of sale and rent prices has been examined; the long-term trends and the short-term fluctuations of housing prices have been determined and the interaction between the change in housing prices and other economic variables has been researched. In this study, it has been found out that the sale and rent prices are compatible with the city model in the sense that it is closed in the short term and open in the long term; that the housing supply in Istanbul has been elastic; that transportation solutions which do not lead to space friction could be produced; that housing prices move parallel to stock exchange and bond prices; and that there has been no house price bubble. |
| Keywords: | Asset Price; House Price Indices; Housing Bubble; Housing Supply; Price To Rent Ratio |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_287&r=all |
| By: | S. Johann |
| Abstract: | The European housing stock is dominated by properties built before the 1980s. These buildings are to a great extent far behind current technical and social requirements. This paper develops a supply- and demand-oriented refurbishment concept for residential buildings, specifically the case of multi-family houses from the 1970s in Western Germany. About 2.4 million dwellings and more than 13% of the entire multi-family housing stock in West Germany are located in multi-family houses from the 1970s, in many cases still without any major refurbishment measures until now. A large portion of this stock was or will be subject of portfolio deals often involving foreign investors. Using data from housing corporations, more than 13,700 energy certificates and expert interviews as well as a secondary analysis of a representative survey of housing demand in Germany the key building characteristics and needs for action for this type of the building stock are identified. Further, the specific requirements of the main target groups are found. The results show prioritized refurbishment measures including improvements of thermal insulation (e.g. roof, exterior walls), energy supply, bathrooms, balconies, house entrance areas as well as the structuring of outdoor facilities. The empirical results are useful for property owners like housing corporations, municipalities, owner communities or foreign investors in Western Germany and other European countries to find fundamental and demand-oriented refurbishment measures for their buildings. |
| Keywords: | Multi-Family Houses; Obsolescence; Refurbishment measures; Residential Property/Building; User Requirements |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_71&r=all |
| By: | A. Heinen; M.Lim Kim; A. Valdesogo |
| Abstract: | In this paper, we analyze and model the dependence of house prices of Metropolitan Statistical Areas (MSAs) in the US, taking into account the dynamics of dependence. We model the dynamics in the dependence, using a regime switching model with a two-state hidden Markov chain. We use a multivariate Gaussian copula and a Canonical Vine copula to model the dependence of house price changes of MSAs, and identify a high and low dependence regime, or a symmetric and asymmetric dependence regime in the housing market. Furthermore, we use interest rates and LTV as factors affecting the transition probabilities of the Markov chain to see if those variables affect the change of dependence between house prices. The main contribution of this paper is to model dependence of house price returns of MSAs which can vary across time in a flexible way using multivariate copulas and a regime switching model. Using various multivariate copulas, we implement the variation of dependence across time in terms of magnitude and shape into the model. First, we use a multivariate Gaussian model with an equicorrelation for all pairs of MSAs, and estimate two different equicorrelations which are for different two regimes with a regime switching model. Through this estimation, we ï¬nd a high and a low dependence regime in the housing market among MSAs. Besides the magnitude of dependence, we model different shapes of dependence for different regimes across time using a Canonical vine copula and a multivariate Gaussian copula with a regime switching model. The former is employed for an asymmetric dependence or tail dependence regime , and the latter is used for a symmetric dependence regime. In this paper, we verify a symmetric and an asymmetric dependence regime for different time period. Besides, using macroeconomic variables such as the change rate of interest rate (∆ r) and the change rate of Loan to Value (∆ LTV), we see if these variables can explain different dependence regimes across time in a better way. We ï¬nd, especially, ∆ LTV is consistently shown to be closely related to a high dependence regime. This partly shows the vicious cycle between credit supply and house prices. |
| Keywords: | Contagion; Copula; Credit Risk; Dependence; Regime Switching |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_201&r=all |
| By: | S. Huston |
| Abstract: | Most economic development over the next fifty years is likely to be centred on regional towns. Many of regional conurbations are ill prepared to cope with growth pressures. Others are more geared up for 'smart growth'. Some regional settlements have aspirations to become 'knowledge hubs' to attract investment and generate prestigious local jobs. University status or expansion is one promising regional development catalyst. Urban beautification projects can also help to attract foreign talent or retain local skills and avoid the stigma associated with 'dormitory suburbs' or cultural deserts. However, the metamorphosis of conservative regional market towns into vibrant knowledge Arcadias confronts philosophical, forecasting, institutional, housing and funding constraints. The research outlines the contested urban renewal backdrop and applies an environmental scanning and systems framework to it. In its empirical phase, the research investigates how catalysts, drivers and development constraints manifest at the local level in the case of two expanding regional English conurbations - Hereford and Cirencester. |
| Keywords: | Environmental Scanning; Knowledge Hubs; Partnerships; Regional Development; Smart Growth |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_42&r=all |
| By: | I. Janssen; R. Bougie; K. Pillen |
| Abstract: | The use of reserved price strategies gained popularity in the Dutch housing market. The more common asking price strategy is still widely applied and gives potential buyers the opportunity to negotiate below a listed asking price. Since the market can be characterized as cold and the average time that it takes to sell the property (Time on Market) has increased from 86 days in 2007 to 176 days in 2013, sellers and brokers are looking for new pricing strategies. In 2014 one of every fifty houses was sold on a reserved price basis, where a fixed minimum was the starting point for negotiation. The aim of this research was to measure the effect of using different pricing strategies on the actual sales price and the TOM. For this purpose data was collected on 5.316 reserved price transactions and 24.582 sales prices transactions covering the period 2009-2014. Hedonic regression modelling was used to estimate the effect of pricing strategy on the sales price and Time on Market. In our analyses we controlled for variables that might potentially bias our results. Results show that using the reserve price method the Time on Market decreases with more than 50% compared to using the asking price method. The average reduction of the sales price, using reserved pricing, is 4,4%. These results give clarity for sellers of houses in their tradeoff between price concessions that they are willing to take and the expected reduction of the time that is required to sell the house. |
| Keywords: | Hedonic Modelling; Housing Market; Pricing; Time To Market |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_120&r=all |
| By: | D. Hsiu-yin |
| Abstract: | Land fragmentation is deemed to be a significant factor in delaying land development especially for integrating an urban renewal project. One strategy to identify urban renewal area is that the landowners designate the renewal units by themselves in accordance with the criteria as determined by the local authority. They may apply for implementation of the urban renewal business of that area in keeping with the regulations. However, land assembling always takes a long time in processing an urban renewal business so as to not all renewal units are successful led to successful urban renewal businesses. How long will a renewal unit take to implement an urban renewal business is crucial for successfully implementing urban renewal projects. In this study the time that renewal units take to implement urban renewal businesses and why they do were analyzed. |
| Keywords: | Land assembly; Land fragmentation; Renewal Unit |
| JEL: | R3 |
| Date: | 2015–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2015_134&r=all |
| By: | P. Bonifaci |
| Abstract: | This short essay try to discuss the key issues about doctoral research in real estate appraisal within a Ph.D. Course in regional planning and public policy, which is held at IUAV University of Venice. |
| JEL: | R3 |
| Date: | 2014–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_edu_113&r=all |
| By: | Canfei He; Qi Guo; David Rigby |
| Abstract: | The importance of agglomeration externalities for economic activities is widely recognized. Recent developments highlight the importance of industry relatedness to the performance of firms, industries and regions. This study explores the determinants of firm survival in China and tests the significance of industry relatedness using firm-level data over the period 1999-2007. Industry relatedness is developed from the co-occurrence analysis of paired industries. Results based on Cox regression models show that firms benefiting from industry relatedness and governmental supports are more likely to survive. However, the influence of relatedness varies across industries and provinces. This study highlights the significant influence of local forces on firm dynamics and enriches our understanding of regional industrial restructuring in China. |
| Keywords: | Industry relatedness, Agglomeration Externalities, Firm Survival, China |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1528&r=all |
| By: | Canfei He; Yi Zhou |
| Abstract: | Industrial change processes are underlying forces that determine the change of regional productivity. In developed market economies, less productive firms are more likely to exit while productive firms have more chance to enter and to survive. As a result, spatial inequality of firm dynamics will directly influence the inequality of regional productivity. This study investigates how firm dynamics would affect regional productivity using firm level data during 1998-2007 in China. We first estimate total factor productivity (TFP) for each firm based on the semi-parametric method proposed by Olley and Pakes (1996). Regional productivity is derived by weighing the firm TFP using gross industrial output. There is considerable spatial inequality of TFP paired with a trend of convergence over the time period of 1999-2007. Decomposition of TFP growth shows that firm entry, exit and survival do contribute to TFP change and their contributions vary across prefectures substantially. The between share holds the largest regional difference, as the most important factor contributing to the spatial inequality of regional TFP. The restructuring of SOEs has critically contributed to the spatial inequality of TFP by raising TFP in the traditional industrial bases and by facilitating the development of productive private and foreign sectors particularly in the coastal region. The finding indicates that resource reallocation across firms with different ownerships is the key mechanism to improve regional productivity. |
| Keywords: | Firm Dynamics, Regional Inequality, TFP, Decomposition Method, China |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1527&r=all |
| By: | Charles Raux (LET - Laboratoire d'économie des transports - CNRS - UL2 - Université Lumière - Lyon 2 - École Nationale des Travaux Publics de l'État [ENTPE]); Ayman Zoubir (LET - Laboratoire d'économie des transports - CNRS - UL2 - Université Lumière - Lyon 2 - École Nationale des Travaux Publics de l'État [ENTPE]) |
| Abstract: | This paper analyzes the socio-demographic profile and travel behavior of the “Velov” bikesharing scheme members in Lyon (France). This scheme started in 2005 and has now around 350 stations and 4500 bikes in operation, with more than 50,000 annual members. Thanks to a specific Internet-based survey more than 3,000 respondents were described by their detailed socio-demographic profile, their travel means and habits, a one-day activity-travel diary and additionally a seven days activity-travel diary log by around 700 volunteers. By this way the survey covers all travel modes and day-to-day variations in travel behavior beyond the sole use of shared bike. We analyze with a discrete choice model the socio-demographic and spatial factors affecting the probability of being an annual member of the Velov scheme. Then we explore with descriptive statistics their daily travel behavior involving as well bike sharing as other traditional modes. When possible this behavior is compared with the latest Household Travel Survey available in the Lyon area (2006). Velov annual members are rather younger and hold higher social positions when compared with the Lyon’s reference population. An individual higher social position and the residential proximity to stations have both separate and positive effects on the probability of being an annual member of the service. Velov members are not captive from public transport, they have access to a car and they are fully multimodal in their day-to-day travel behavior. Velo’v bikes are used by them for any activity, not necessarily every day, like any other travel mode. |
| Keywords: | Bikesharing,Lyon,annual members,one week travel diary,discrete choice model,descriptive statistics |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01193169&r=all |
| By: | Arrondel, Luc; Lamarche, Pierre; Savignac, Frédérique |
| Abstract: | This paper studies the heterogeneity of the marginal propensity to consume out of wealth using French household surveys. We find decreasing marginal propensity to consume out of wealth across the wealth distribution for all net wealth components. The marginal propensity to consume out of financial assets tends to be higher compared with the effect of housing assets, except in the top of the wealth distribution. Consumption is less sensitive to the value of the main residence than to other housing assets. We also investigate the heterogeneity arising from indebtedness and from the role of housing assets as collateral. JEL Classification: D12, E21, C21 |
| Keywords: | Consumption, Household survey, Marginal propensity to consume out of wealth, Policy distributive effects |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20151817&r=all |
| By: | Richard G. Newell; Daniel Raimi |
| Abstract: | Oil and gas development associated with shale resources has increased substantially in the United States, with important implications for local governments. These governments tend to experience increased revenue from a variety of sources, such as severance taxes distributed by the state government, local property taxes and sales taxes, direct payments from oil and gas companies, and in-kind contributions from those companies. Local governments also tend to face increased demand for services such as road repairs due to heavy truck traffic and from population growth associated with the oil and gas sector. This paper describes the major oil- and gas related revenues and service demands (i.e., costs) that county and municipal governments have experienced in Arkansas, Colorado, Louisiana, Montana, North Dakota, Pennsylvania, Texas, and Wyoming. Based on extensive interviews with officials in the most heavily affected parts of these states, along with analysis of financial data, it appears that most county and municipal governments have experienced net financial benefits, though some in western North Dakota and eastern Montana appear to have experienced net negative fiscal impacts. Some municipalities in rural Colorado and Wyoming also struggled to manage fiscal impacts during recent oil and gas booms, though these challenges faded as drilling activity slowed. |
| JEL: | H25 H71 H72 H76 Q32 Q33 Q41 Q43 Q48 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:21542&r=all |
| By: | Claire Crawford (Department of Economics, University of Warwick and Institute for Fiscal Studies); Lindsey Macmillan (Department of Quantitative Social Science, Institute of Education, University College London); Anna Vignoles (Faculty of Education, University of Cambridge) |
| Abstract: | The role of education as a potential driver of social mobility has been well established and it is critical that we understand how children from different socio-economic backgrounds fare in the education system. In this paper, we examine the trajectories of initially high- and low-achieving children from lower and higher socio-economic status families from age 7 through to the end of compulsory education (age 16) in England for the first time. This enables us to provide new insights into when initially high attaining poor children fall behind their better-off peers. We show that there are substantial differences in educational attainment by socio-economic background at age 7, and that these differences increase as children move through the education system. Our results indicate that pupils from poor backgrounds who score highly in primary school fall behind their better-off but lower achieving peers during secondary school. These findings are not caused by ''regression to the mean'' (where a child with 'high' or 'low' achievement on any given day may have over- or under-performed relative to their 'true' attainment, meaning that the next time they are tested they will look more like the average individual). This suggests that secondary school may be a critical period to intervene to ensure poor children do not fall behind their better-off peers. We also provide suggestive evidence on the extent to which these patterns can be explained by the types of schools that pupils from different backgrounds attend, and by the differing attitudes and aspirations of the pupils and their families. Our analysis suggests that there is less convergence amongst pupils who attend the same schools. And if all pupils had the attitudes and aspirations of the average pupil, there would be more convergence. While we remain cautious about the implications of these findings, they provide suggestive evidence that schools (or the sorting of pupils into schools) and the attitudes and aspirations held by children from different backgrounds may contribute to the convergence in attainment that we see. |
| Keywords: | Social Mobility; Education Achievement; Regression to the mean |
| JEL: | I20 I24 J13 |
| Date: | 2015–09–09 |
| URL: | http://d.repec.org/n?u=RePEc:qss:dqsswp:1508&r=all |
| By: | HAMAGUCHI Nobuaki; KONDO Keisuke |
| Abstract: | This paper analyzes whether freshness of knowledge increases the quality of innovation by using the Japanese patent database. Agglomeration is generally believed to foster the creation of new knowledge through knowledge spillover, such as active face-to-face communication; however, expansion of common knowledge within research communities may discourage high-quality innovation. Taking this into consideration, we attempt to examine the turnover effects of knowledge workers across cities by looking at the interregional migration of university graduates. We find that the quality of innovation as measured by the number of patent citations tends to be higher in cities with bigger migration flows of university graduates. More importantly, we find that metabolizing agglomeration plays an important role for high-quality innovative activities. |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:15108&r=all |
| By: | Fernandez-Zubieta, Ana; Geuna, Aldo; Lawson, Cornelia (University of Turin) |
| Abstract: | In this chapter we review the literature on the analysis of researcher mobility and productivity highlighting recent changes in the research system - internationalization, inter-sector mobility and collaboration and career diversification which make researcher mobility more relevant for the dynamics of knowledge creation and dissemination. Our review reveals that to date we still know little about the consequences and motivations of increased mobility for individual researchers. We contribute by presenting a typology of researcher mobility, and considering the relevance of multiple mobility events throughout a researcher career. Finally, we review the modeling problems related to analyzing the effect of mobility on academic performance at the individual level, and suggest various solutions. |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:uto:labeco:201508&r=all |
| By: | Andersson, Matts (KTH); Dehlin, Fredrik (PwC Norway); Jörgensen, Peter (WSP); Pädam, Sirje (WSP) |
| Abstract: | This paper starts out with by discussing the definitions of Wider Economic Impacts/Benefits and regional development. Each area where WEIs could be present is then treated: economic growth (production and cost function studies), labour market (agglomeration, labour supply), commodity market and housing market. A theoretical background is given, the empirics are summarized and the relation to CBA is discussed. |
| Keywords: | Wider economic impacts; Wider economic benefits; Regional development; Cost-benefit analysis; Agglomeration; Labour supply; Labour market; Housing market; Commodity market |
| JEL: | D61 E24 H40 R40 |
| Date: | 2015–09–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2015_014&r=all |
| By: | Simon Søbstad Bensnes (Department of Economics, Norwegian University of Science and Technology); Bjarne Strøm (Department of Economics, Norwegian University of Science and Technology) |
| Abstract: | Many countries have recently removed or relaxed restrictions on shop opening hours. If deregulation increases job opportunities for unskilled young people it may affect incentives to make education investments. This paper studies the impact of deregulation of shop opening hours on youth employment, schooling decisions and subsequent earnings. We use a national reform in shop opening hour restrictions in Norway in 1985 to provide quasiexperimental evidence by exploiting that the bite of the reform varied considerably across municipalities. We find that increased potential opening hours substantially reduced the average probability to graduate from high school and especially so for the group of students with less educated parents. These students also experienced a reduction in completed years of education and some earnings reduction in adulthood. Combined with the finding that deregulation increased employment of 16-24 year old workers in the retail sector by 12% on average, the evidence is consistent with the view that opportunity cost of study time is an important determinant of human capital investments. |
| Keywords: | high school graduation, earnings, employment, deregulation, opening hours |
| JEL: | J24 |
| Date: | 2015–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:nst:samfok:16515&r=all |
| By: | Chaminade , Cristina (CIRCLE, Lund University and INGENIO, CSIC, Spain); De Fuentes , Claudia (Sobey School of Business, Saint Mary’s University, Canada); Harirchi , Gouya (DEAMS, University of Trieste, Italy); Plechero , Monica (DEAMS – University of Trieste, Italy & CIRCLE, Lund University) |
| Abstract: | The increasing de-localization of innovation activities to and from emerging economies has triggered a growing interest among scholars of diverse disciplines in understanding the drivers and consequences of the increased globalization of innovation activities; In doing so, a variety of concepts have been used, from global value chain to global production networks and global innovation networks. The aim of this paper is to provide an overview of what we know about the structure and the geography of these global innovation networks, by looking, in particular, at the geographic concepts that underpin current work on global innovation networks as well as the spatial implications of the increased globalization of innovation activities. |
| Keywords: | global innovation networks; regional embeddedness; network structure; network geography |
| JEL: | O19 O33 R11 |
| Date: | 2015–09–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_031&r=all |
| By: | Albuquerque, Bruno; Krustev, Georgi |
| Abstract: | Using a novel dataset for the US states, this paper examines whether household debt and the protracted debt deleveraging help explain the dismal performance of US consumption since 2007 in the aftermath of the housing bubble. By separating the concepts of deleveraging and debt overhang - a flow and a stock effect - we find that excessive indebtedness exerted a meaningful drag on consumption over and beyond income and wealth effects. The overall impact, however, is modest - around one-sixth of the slowdown in consumption between 2000-06 and 2007-12 - and mostly driven by states with particularly large imbalances in their household sector. This might be indicative of non-linearities, whereby indebtedness begins to bite only when misalignments from sustainable debt dynamics become excessive. JEL Classification: C13, C23, C52, D12, H31 |
| Keywords: | Consumption function, Debt overhang, Household deleveraging, Housing wealth |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20151843&r=all |
| By: | Duffy, David; Morley, Ciara |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:esr:resnot:rn2015/2/3&r=all |
| By: | Popov, Alexander; Rocholl, Jörg |
| Abstract: | This paper identifies the effect of financing constraints on firms’ labor demand. We exploit exogenous funding shocks to German savings banks during the US mortgage crisis that are unrelated to local conditions. We find that firms with credit relationships with affected banks experienced a significant decline in employment and in labor compensation relative to firms whose credit relationships were with healthy banks. We also find that the employment effect increases, and the wage effect decreases with firm size. The decline in employment at firms attached to affected banks appears to be more long-lasting than the decline in labor compensation. JEL Classification: D92, G01, G21, J23, J31 |
| Keywords: | Credit constraints, employment, financial crisis, labor compensation |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20151821&r=all |
| By: | Michael L. Anderson; Fangwen Lu; Yiran Zhang; Jun Yang; Ping Qin |
| Abstract: | Congestion plays a central role in urban and transportation economics. Existing estimates of congestion costs rely on stated or revealed preferences studies. We explore a complementary measure of congestion costs based on self-reported happiness. Exploiting quasi-random variation in daily congestion in Beijing that arises because of superstitions about the number four, we estimate a strong effect of daily congestion on self-reported happiness. When benchmarking this effect against the relationship between income and self-reported happiness we compute implied congestion costs that are several times larger than conventional estimates. Several factors, including the value of reliability and externalities on non-travelers, can reconcile our alternative estimates with the existing literature. |
| JEL: | R41 R48 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:21551&r=all |
| By: | Clark, William C. |
| Abstract: | In this paper I sketch key episodes in the two thousand year history of interactions between society and environment that have shaped the City of London and its hinterlands. My purpose in writing it has been to provide an empirical puzzle for use in teaching and theorizing about the long term coevolution of social-environmental systems and the potential role of policy interventions in guiding that coevolution toward sustainability. I undertook it because while a lively body of theory has begun to emerge seeking to explain such coevolution, rich descriptive characterizations of how specific social-environmental systems have in fact changed over the long time periods (multi-decade to multi-century) relevant to sustainable development remain relatively rare. One result is that the field of sustainability science lacks a sufficient number of the rich empirical puzzles that any field of science needs to challenge its theorizing, modeling and predictions. This paper reflects the beginning of an effort to provide one such characterization on a topic central to sustainability: the long term development of cities and their hinterlands. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hrv:hksfac:22356529&r=all |
| By: | Anthony J. Howell, Canfei He, Rudai Yang, Cindy Fan; Canfei He; Rudai Yang; Cindy Fan |
| Abstract: | Building on the evolutionary economic geography literature, we employ the density measure introduced by ? to dynamically track the impact of technological relatedness on firm productivity. We rely on advanced quantile regression techniques to determine whether technological relatedness stimulates productivity and whether the size of the effect varies for low and high performing firms. Lastly, taking China’s economic transition into account, we test whether changes in the local industrial mix brought about by China’s market reforms enable or inhibit performance-enhancing spillovers. We show that a dynamic tradeoff exists between agglomeration costs and benefits that depends, in part, on the firm’s placement along the productivity distribution: the effect of technological relatedness reduces productivity for the least performing firms, but enhances it for better performing firms. As a result, spillovers via technological relatedness lead to improvements in the geographical welfare by intensifying the learning effect for the vast majority of co-located firms, in spite of increasing productivity disparities between the bottom and top performing firms. |
| Keywords: | Firm Productivity, Relatedness, Agglomeration Economies, Firm Heterogeneity |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1529&r=all |