Exploring the Ripple Effect and Spatial Volatility in House Prices in England and Wales: Regressing Interaction Domain Cross-Correlations against Reactive Statistics

Crispin Cooper, Scott Orford, Chris Webster and Christopher B Jones
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Crispin Cooper: Sustainable Places Research Institute, Cardiff University, 33 Park Place, Cardiff CF10 3BA, Wales
Christopher B Jones: School of Computer Science and Informatics, Cardiff University, 5 The Parade, Roath, Cardiff CF24 3AA, Wales

Environment and Planning B, 2013, vol. 40, issue 5, 763-782

Abstract: In this study we conduct an exploratory spatiotemporal analysis of recent UK housing-market data 2000–06, fine grained both in space and in time. We present firstly the exploratory technique itself, and secondly an overview of patterns found in the dataset. A broadly scoped metamodel is created which points towards fruitful avenues for further investigation and understanding of the driving forces behind price propagation in the housing market. At the core of this model is an 8850 × 8850 cross-correlation matrix representing price linkage between different areas, which is analyzed by a custom regression engine. Hence this is the first study to unify both local and regional house-price modelling, and the first to look for a quantitative explanation of the structure of any house-price interaction matrix on a large scale. Findings corroborate existing research on the ripple effect and spatial volatility, and point towards mechanisms through which these might arise, as a combination of local interaction and market segmentation broken by lifecycle migration patterns.

Keywords: migration; network analysis; interaction; census; house prices; time series; cross-correlation; spatial data; regression; ripple effect (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:sae:envirb:v:40:y:2013:i:5:p:763-782

DOI: 10.1068/b37062

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