Real estate listings and their usefulness for hedonic regressions

Artikel

Real estate platforms provide a new source of data which has already been used as a substitute for transaction data in hedonic regression applications. This paper asks whether it is valid to do so in the established research areas of (1) willingness to pay estimation, (2) automated valuations, and (3) price index construction. It therefore compares listings and transaction data and regression results derived from them. We find that ask prices stochastically dominate sale prices, mainly because the composition of characteristics differs between the two data sets. But estimates of implicit prices also differ. As a result, willingness to pay estimates from listings data can be widely off when compared with estimates from transaction data. Listings data are not very useful to predict market values of individual houses either, as these predictions suffer from upward bias and large error variance. We find, however, that an ask price index complements a sale price index, as it is useful for nowcasting.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: Empirical Economics ; ISSN: 1435-8921 ; Volume: 61 ; Year: 2021 ; Issue: 6 ; Pages: 3239-3269 ; Berlin, Heidelberg: Springer

Classification and Topics

• Classification: Wirtschaft ; Semiparametric and Nonparametric Methods: General ; Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access ; Housing Supply and Markets
• Subject: Hedonic modelling ; Nowcasting ; Price prediction ; Stochastic dominance

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Kolbe, Jens ; Schulz, Rainer ; Wersing, Martin ; Werwatz, Axel
• Event: Veröffentlichung
• (who): Springer
• (where): Berlin, Heidelberg
• (when): 2021

Further information

• DOI: doi:10.1007/s00181-020-01992-3
• Last update: 10.03.2025, 11:42 AM CET