Spatial heterogeneity of housing prices in formal and informal settlements: A GWR hedonic model for segmented markets in Cali

H Vivas () and A Franco ()

No 19293, Documentos de trabajo - Alianza EFI from Alianza EFI

Abstract: This paper studies the factors associated with differential prices in segmented housing markets. Despite the breadth of the literature addressing this issue, a gap remains in the investigation of differential prices in areas where formal and informal settlements coexist. Based on primary data from more than 550 households, we calibrated a Geographically Weighted Regressions (GWR) hedonic model in the District 18 of Cali, Colombia, as an approach for housing pricing in areas where heterogeneous occupation patterns prevail. The findings reveal that environmental quality, violence, accessibility to transportation, business and services, and household incomes are the variables that have the greatest impact on price structures in both the formal and informal sub-markets. In this regard, the model of price behavior developed in this research improves predictions and provides accurate information to policymakers about the factors associated with housing prices.

Keywords: Spatial heterogeneity; informal settlements; housing prices; Geographically WeightedRegressions (GWR); hedonic prices (search for similar items in EconPapers)
JEL-codes: G28 R21 R28 R31 R38 R58 (search for similar items in EconPapers)
Pages: 28
Date: 2021-06-07
New Economics Papers: this item is included in nep-iue and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:col:000561:019293

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