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Article
Impact of External Characteristics on Housing Rental Prices in the City of Valencia
Author(s)
Alicia Llorca-Ponce
Andrés Cózar-Lizandra
Full-Text PDF XML 564 Views
DOI:10.17265/1537-1514/2021.03.003
Affiliation(s)
Universitat Politècnica de València, Spain
Universitat Politècnica de València, Spain
ABSTRACT
The aim of the paper is to analyze
the impact of external or locational characteristics on the housing rental price.
We try to determine factors that are most important for the housing rental prices
by using the multiple linear regression. We have used a sample of 2,678 rental properties
and start with 18 neighbourhood variables relating to the socio-economic level of
the population, facilities, environmental surroundings and accessibility. In order
to reduce the number of explanatory variables and avoid multicollinearity problems,
we carry out a factor analysis which leads us to select seven variables for future
introduction into a housing price model. The analysis points out that socio-economic
variables of the neighbourhood are the relevant and explanatory elements of the
rental price. We also appreciate that centrality analysed from the distance to the
CBD has not relevance. The results are of interest to the housing rental market,
both for investor’s decision-making and for the design of marketing and communication
strategies. Also, the results are useful to the design of urban policies relating
to public housing for rent. The housing area has a very important weight in the
model; if we limit it in the selected sample, we think that we will be able to measure
to a greater extent the impact of external variables.
KEYWORDS
housing market, rental price, externalities, accessibility
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