Search results

The aim of this education briefing is to comment upon how basic hedonic pricing models for the valuation of property can be expanded and developed. In this case, the briefing illustrates the use of the new economic approach to the analysis of housing markets, namely the search-and-matching models.

This education briefing discusses the connection of two important economic theories: the hedonic price theory and the search-and-matching theory.

This education briefing gives an example of a (non-linear) form of the hedonic price function.

In cases of mass appraisals, hedonic pricing models can provide a broad indication of value across submarkets and this education briefing demonstrates a theoretical model that can be used to provide a theoretical groundwork for the use of a concave hedonic price function in empirical estimates.

This education briefing shows how basic hedonic pricing models can be enhanced by a search-and-matching approach to determine property values.

The purpose of this paper is to determine and analyse that factors that could potentially influence price premiums of Australian wine in the UK market. The authors integrated the economic-based hedonic pricing theory and marketing export pricing literature. The authors demonstrate a potential solution to limitations in knowledge of market-level data and industry wide competition, currently lacking in export pricing studies.

Using data extracted from wine-searcher.com and using multiple regression as the main analytical technique, the authors examined the relationships between actual retail prices UK consumers pay for Australian wine and product attributes. The authors compared the moderating influence of distribution channel (retail choice) on these relationships.

The results provide insights in export pricing literature, and the authors support better theoretical explanations for hedonic pricing studies in export marketing. The authors found two types of wine attributes – “brand” and “region of origin” – that attract price premiums. While relationships between variety and retail price, as well as age and retail price are less clear, the authors provide some support.

One limitation of this hedonic pricing study is the inability to explain why certain relationships between product attributes and price premiums exist. Studies such as these could be improved by utilising both consumer- and firm-level data.

Whilst final prices paid by consumers are beyond the control of producers, understanding the relationships between retail prices, retail choices and product attributes are of strategic importance. Understanding the role consumer preferences play in determining prices they ultimately pay is of great value when determining export/retail pricing strategies.

Consumers and firm managers are jointly able to provide comprehensive explanations on why certain attributes attract price premiums. The integration of economic and consumer-based theories provides a holistic understanding of the influence of retail choices and product attributes on retail prices.

The authors drew on the hedonic pricing theory linking product attributes with retail prices, which is vital for understanding market share and brand image. The authors identified which product attributes and which distribution channels (retail choices) are valuable to consumers. Deeper understanding of these issues is important for producers.

The study aims to investigate how attribution theory in the context of pricing strategies can help tourism destinations recover from the negative impacts of the COVID-19 pandemic.

The study adopted a qualitative research design using semi-structured interviews to address the lack of research in this area. Interview participants included tourists and tourism customers. The interview responses were then analyzed using “Nvivo” qualitative data analysis software to identify critical themes regarding applying attribution theory to pricing strategies.

The findings revealed that tourists prefer bundled and hedonic pricing strategies that integrate the service providers' pricing strategies' locus of control, stability and controllability. Tourists do not favor dual pricing strategies unless the reasons for price controllability or stability are justified. Tourists also prefer the controllable pay-what-you-want pricing strategy. Although tourists accept dynamic pricing, certain conditions related to price locus, stability and controllability must be met.

The research shows tourists prefer pricing strategies that give them control and flexibility, like bundled packages and pay-what-you-want models. Service providers should integrate pricing strategies that transparent costs and justify price fluctuations. While dynamic pricing is accepted if necessitated by external factors, tourists are wary of unnecessary price changes. Providers can build trust and satisfaction by explaining pricing rationale and offering controllable options like bundles.

The study contributes to the theory by applying attribution theory to the context of pricing strategies in tourism. It also provides innovative recommendations for tourism managers on how to use pricing strategies after the COVID-19 pandemic. The findings offer new insights that extend beyond previous research.

The aim of this paper is to present estimation results of hedonic price models as well as housing price indices for the Warsaw secondary market.

Three direct methods of constructing a hedonic price index and four indices that allow for quality adjustment are presented. The paper also discusses theoretical issues related to the estimation and interpretation of hedonic models.

It is shown that the imputation and the time dummy variable indices are subject to less variation than the characteristic price index. It is also shown that in comparison to the mean and the median, hedonic indices are less variable, which can be interpreted as partial control for quality changes in dwellings sold.

As this research project represents one of the first attempts of hedonic modelling applied to the Polish housing market, its results may be employed by appraisers to gain insight into behaviour of the Warsaw housing market. Practical implications focus on reliable measurement of house price dynamics in Poland. This paper supplies an appropriate methodology for addressing this question and offers empirical solutions.

Employment of hedonic models for construction of quality‐adjusted housing price indices has not yet been explored in Poland. The theoretical and practical aspects of hedonic indices presented in the paper open promising directions for the development of Polish statistics of real estate prices.

The basic purpose of this paper is to explore the relationship between the sustainability of construction on the one hand and market value, worth and property investment performance on the other hand. This paper aims to analyse price movements and price differences caused by different property characteristics.

Based on the estimated log‐linear hedonic regression model, a hedonic price index is calculated. Price movements subject to different property characteristics are examined by constructing various conditional hedonic price indexes.

The results reveal that, high‐quality flats or flats within preferred locations clearly outperform their competitors in terms of price stability during an overall market downturn. However, it is also shown that contemporary building descriptions or specifications of transactions within property databases are not yet sufficient and need to be widened to meet forthcoming challenges. Therefore, an “integrated building performance approach” is introduced and a proposal for the step‐wise improvement of building descriptions is made.

The paper shows that efforts need to be undertaken by the property profession in combining and transferring financial performance data along with information that is indicative of a building's contribution to sustainable development.

The paper offers insights into the relationship between the sustainability of construction and market value.

Real estate is one of the fundamental growth engines for developing economies as it contributes urbanization and infrastructure development. In recent years, Somalia has witnessed massive real estate development in both housing and commercial buildings. The purpose of this study is twofold. First, the study examines the determinants of residential property rents. Second, it investigates whether residential property rents are fairly valued.

This study uses two-stage modeling. A hedonic regression model is used in the first stage, while an artificial neural network is applied in the second stage.

After analysis, this study established that size, location and security of a residential property have a significant influence on its monthly rents. Alternatively, the study identified that residential property rents are not fairly valued in Mogadishu and overvaluation is more frequent than undervaluation.

This implies that Somalia’s real estate industry is more speculative-driven than real demand-driven. Though Somali real estate is an infant industry with huge potentials in the long run, it may end up disastrously following the well-known bubble-then-burst behavior. To avoid such crisis, this study recommends formulating government policies that regulates, supervises and protects the infant real estate industry without undermining the needs of the poor and low-income citizens.

Eastern European countries have an important history of quality and tradition in winemaking. The radical economic modification that the wine sector had to face during communism exposed these countries to various problems during transition, when their market share in Western European markets shrunk. This paper aims to argue that an important cause of the decline is the inability of price to convey information about the quality level of the wine, as from the theory of asymmetric information.

This paper uses the econometric theory of hedonic pricing to explore the research question, relating price to the characteristics of the wine, including a quality rating from a respected British wine expert for the year 2006. Results are presented for a sample of 134 wines coming from different Eastern European countries (EEC) sold in the UK. The analysis also tackles the issue of understanding which parameters contributed to the quality level of Eastern European wines, modelling the qualitative description in order to identify the keywords that explains the change in quality level.

The results show evidence of no correlation between ratings and price in the considered segment of the UK wine market, suggesting an imperfect communication of quality via the price information. Moreover, Romania, which is a very important producing country, has a weak brand value, suggesting the need for restructuring the industry and improving quality management schemes to compete in their newly enlarged destination market. The quality model shows that fruity flavours are those playing a most important role in defining the quality level; hence a more targeted product supply should be encouraged.

No previous research has used hedonic modelling to the case of Eastern European wines. Furthermore, the context used here is to understand the weaknesses of the specific segment, and the tool is used to investigate the loss of competitive advantage of Eastern European products in the UK markets, focusing on the quality/price relation.

The purpose of this paper is to demonstrate how the specification of hedonic pricing models can be improved by using insights generated from qualitative research. In doing so, it seeks to address one of the main problems in the specification of hedonic models, namely that theory yields little guidance in the selection of the characteristics that should be included on the right-hand side.

Building on the behavioural tradition in real estate research, this paper introduces a research approach that integrates insights from qualitative analysis in an econometric model of land values. The empirical segment explores the way in which asking prices of building plots for industrial purposes are determined in The Netherlands. It draws from interviews with municipal land developers, who dominate supply in this market. The information secured during these interviews relates to the characteristics considered important and the kind of information used in the valuation process. Based on these qualitative data, an econometric model is developed and estimated.

The estimation results confirm qualitative evidence that the typical developer considers only a limited number of features of the land in the valuation process and that the primary source of information in setting asking prices relates to the prices charged in neighbouring municipalities.

This paper represents a novel attempt to examine the determination of land and property values by merging qualitative and quantitative, econometric analyses.

The purpose of this paper is to test the relationships between a hotel’s design quality and the property’s business performance.

Hotel guests’ assessments of the design quality of hotels that they recently visited are tested using the design quality indicator (DQI). Business performance is measured using indexed values for each property’s occupancy, average daily rate (ADR) and revenue per available room (RevPAR). The data are analyzed using exploratory factor analysis and a variation of a hedonic pricing model.

Factor analysis reduced the DQI instrument to 19 measurement items. Factors that measure navigability and signage positively impact occupancy index. Factors that measure flexible space usage negatively impact the RevPAR and ADR indices. Factors that reflect aesthetic constructs, including Urban & Social Integration and Character & Form, positively impact the RevPAR and ADR indices.

The study examines a nationwide sample of guests from two full-service brands of a single multi-brand hotel company. The study provides a parsimonious, validated design measurement instrument and a revised hedonic pricing analysis.

Hoteliers can use this technique to assist with resource allocation decisions. Aesthetic elements, including the building’s Urban & Social Integration with its surroundings and its Character & Form, lead to higher ADR and RevPAR performance. Managers should ensure a coherent layout and good signage program to drive occupancy.

This study offers a technique to measure design quality and a new method of performing a hedonic pricing analysis.

This study aims to explore the housing demand of urban fringe residents in southwest Ankara. Two subquestions were developed: What are the respondents’ perceptions of Ankara city center and which characteristics do they prioritize for living in the urban fringe? Data were collected through a face-to-face household survey, and a hedonic regression model was developed based on responses.

Increasing housing demand, lifestyle change and faulty housing policies in Ankara have triggered urban sprawl along fringe areas, which causes several urban problems. Considering that urban sprawl is related to housing demand, it is essential to examine the structure of housing demand and the preference to live near the urban fringe.

According to the survey results, security, crime, noise pollution, traffic congestion and parking problems that reduce the welfare of Ankara city center encouraged expansion toward the rural–urban fringe, in addition to low-quality or traditional housing attributes. The urban core became unattractive to the respondents for being insecure, chaotic and down-market. The hedonic model showed that seven variables, all related to housing characteristics, best explain the housing demand in the area. Socioeconomic status and lifestyle were found to be associated with the desire to live on the urban fringe, also indicating the snob effect.

The authors propose taking domain-specific housing demand patterns in the spatial planning assumptions and housing policies into consideration for a well-governed urban development in Ankara. Making the city center more appealing through rehabilitation should be preferable rather than limiting demand on the urban fringe with a strict intervention in housing supply.