Hedonic Price Modeling of the Saskatoon Housing Market with Particular Emphasis on Inner-city Neighborhoods, 1980-1983
Andreas, Charles D
The primary focus of this research was directed towards the identification of the important determinants of housing quality and the evaluation of their effects upon single-family house prices in Saskatoon during the period 1980-8). Housing values were explained using information on the physical characteristics of the house and of the site, and on some features of the neighborhood in which the house is located. A specific objective of the analysis was to determine if separate spatial submarkets exist as defined by housing location in the five inner-city neighborhoods and location in the older and newer suburbs of the city. The study has shown that housing market values vary systematically with respect to differentials in most. of the housing and neighborhood. characteristics included in the multiple regression model. regression coefficients Here generally consistent with a priori expectations and high levels of statistical explanation approaching .80 were achieved. Results of submarket testing shoved a marked variation in the strength of association be-tween variables and house price between the two areas of Saskatoon. It was determined that division of the single-family housing market into core and non-core neighborhoods did produce separate submarkets with statistically significant independent price structures and also resulted in an improvement in the level of explanation over the stratified model. . Other results included the finding that considerably more variation in house price was explained in suburban areas compared to the innercity neighborhoods (approximately 14% more). A ratio of house and neighborhood. parameters revealed that neighborhood traits are very prominent determinants of housing value as they explain between 32% (for non-core neighborhoods) and 60% (for core neighborhoods) of the standardized variation in house price. Sizeable differentials were found to exist among the five inner-city neighborhoods in terms of average over-all house price, volume of homes that Here offered for sale, and net price change that. occurred over the period of study. Classification of residuals illustrated how the inner-city neighborhoods were also differentiated with respect to both the general accuracy of the regression model as a predicater of house price, and with respect to the predominate direction of significant residuals.