Determinants of House Price: A Decision Tree Approach
Gang-Zhi Fan (),
Seow Eng Ong () and
Hian Chye Koh
Additional contact information
Hian Chye Koh: School of Business, SIM University, Clementi Road, Singapore 599491, email@example.com
Urban Studies, 2006, vol. 43, issue 12, 2301-2315
The hedonic-based regression approach has been utilised extensively to investigate th relationship between house prices and housing characteristics. However, this approach is subject t criticisms arising from potential problems relating to fundamental model assumptions an estimation such as the identification of supply and demand, market disequilibrium, the selectio of independent variables, the choice of functional form of hedonic equation and marke segmentation. This study introduces and utilises an alternative approach-the decision tre approach, which is an important statistical pattern recognition tool. Using the Singapore resal public housing market as a case study, the article demonstrates the usefulness of this techniqu in examining the relationship between house prices and housing characteristics, identifying th significant determinants of housing prices and predicting housing prices. The built tree show that homebuyers are more concerned about the basic housing characteristics of two- and three room flats or four-room flats such as floor area, model type and flat age. However, homebuyer of five-room flats pay more attention to floor level in addition to the basic housin characteristics. In addition, homebuyers of executive apartments are less concerned about basi quantitative characteristics and have higher housing consumption expectations and pay mor attention to 'quality' and service characteristics such as recreational facilities and the livin environment.
References: Add references at CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:sae:urbstu:v:43:y:2006:i:12:p:2301-2315
Access Statistics for this article
More articles in Urban Studies from Urban Studies Journal Limited
Bibliographic data for series maintained by SAGE Publications ().