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House prices and neighbourhood amenities: beyond the norm?

Michael James McCord (School of the Built Environment, Ulster University, Newtownabbey, UK)
Peadar Thomas Davis (School of the Built Environment, Ulster University, Newtownabbey, UK)
Paul Bidanset (Office of the Real Estate Assessor, Norfolk, Virginia, USA)
William McCluskey (African Tax Institute, University of Pretoria, Pretoria, South Africa)
John McCord (School of Law, Ulster University, Newtownabbey, UK)
Martin Haran (School of the Built Environment, Ulster University, Newtownabbey, UK)
Sean MacIntyre (School of the Built Environment, Ulster University, Newtownabbey, UK)

International Journal of Housing Markets and Analysis

ISSN: 1753-8270

Article publication date: 9 January 2018

Issue publication date: 21 May 2018

515

Abstract

Purpose

Understanding the key locational and neighbourhood determinants and their accessibility is a topic of great interest to policymakers, planners and property valuers. In Northern Ireland, the high level of market segregation means that it is problematic to understand the nature of the relationship between house prices and the accessibility to services and prominent neighbourhood landmarks and amenities. Therefore, this paper aims to quantify and measure the (dis)amenity effects on house pricing levels within particular geographic housing sub-markets.

Design/methodology/approach

Most hedonic models are estimated using regression techniques which produce one coefficient for the entirety of the pricing distribution, culminating in a single marginal implicit price. This paper uses a quantile regression (QR) approach that provides a “more complete” depiction of the marginal impacts for different quantiles of the price distribution using sales data obtained from 3,780 house sales transactions within the Belfast Housing market over 2014.

Findings

The findings emerging from this research demonstrate that housing and market characteristics are valued differently across the quantile values and that conditional quantiles are asymmetrical. Pertinently, the findings demonstrate that ordinary least squares (OLS) coefficient estimates have a tendency to over or under specify the marginal mean conditional pricing effects because of their inability to adequately capture and comprehend the complex spatial relationships which exist across the pricing distribution.

Originality value

Numerous studies have used OLS regression to measure the impact of key housing market externalities on house prices, providing a single estimate. This paper uses a QR approach to examine the impact of local amenities on house prices across the house price distribution.

Keywords

Citation

McCord, M.J., Davis, P.T., Bidanset, P., McCluskey, W., McCord, J., Haran, M. and MacIntyre, S. (2018), "House prices and neighbourhood amenities: beyond the norm?", International Journal of Housing Markets and Analysis, Vol. 11 No. 2, pp. 263-289. https://doi.org/10.1108/IJHMA-04-2017-0043

Publisher

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Emerald Publishing Limited

Copyright © 2018, Emerald Publishing Limited

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