Original scientific paper
SPATIAL ELASTICITY OF ASKED PRICE IN THE ZAGREB HOUSING MARKET
The goal of this paper is to estimate effect of distance on prices on the housing market in the City of Zagreb. Estimated hedonic econometric model confirms the theoretical expectation of the negatively sloped bid-rent curve – negative effect of distance on real estate prices. The results are robust even after effects of neighborhoods, time, size and average speed of commuting between dwellings and downtown are accounted for. The results of this study have strong implications due to the fact that most of the scientific papers on Croatian real estate market and almost all professionals on the market use neighborhood/regional averages as proxies for distance. The topic of the research is important in the framework of: (i) mass estimation of the real estate properties in the context of the real estate tax introduction; (2) estimation of the fair value of real estate properties within the Basel III rules in the financial sector.
Visits: 1.622 *