The fundamental determinants of real estate prices: a study for Brazil

Guilherme Moreira da Costa Lopes (), Ari Francisco de Araujo Junior () and Luiz Carlos Day Gama ()
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Guilherme Moreira da Costa Lopes: Ibmec
Ari Francisco de Araujo Junior: Ibmec
Luiz Carlos Day Gama: Ibmec

Revista de Economia Mackenzie (REM), 2023, vol. 20, issue 1, 173-202

Abstract: This study aims to analyze the main determinants of housing prices in Brazil. Considering that real estate are very heterogenic different methodologies were adopted in order to analyze the residential real estate market, both from a macro and micro perspective. In the first approach, models by pooled OLS, fixed effects and random effects were estimated in order to test the impact of important eco-nomic indicators in the country, such as: the Selic rate, unemployment and in-come. Among the results found, a price elasticity of 0.259 in relation to income was estimated. In the second approach, hedonic models that allow capturing the effect of the characteristics of the residences and their location on the property prices were estimated, for the city of Belo Horizonte. Among the results found, it is noteworthy that infrastructure has a positive impact on the price of real estate.

Keywords: Brazil; property prices; hedonic prices; panel data; real estate market. (search for similar items in EconPapers)
JEL-codes: D10 R21 R31 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:aft:journl:v:20:1:2023:jan:jun:p:173-202

DOI: 10.5935/1808-2785/rem.v20n1p.173-202

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