Estimating willingness to pay for housing characteristics: an application of the Ellickson bid-rent model
Article Abstract:
An estimate is offered of willingness to pay for housing characteristics. A discrete-choice bid-rent framework is utilized that was developed by B. Ellickson and modified by S.R. Lerman and C.R. Kern. An initial, empirical test of the Kerna nd Lerman modifications is conducted, employing household data from Bogota, Columbia. A comparison of forecasted bid-rent with actual ones and forecasted dwelling occupants to actual ones is used to evaluate the results of the model. Study findings suggest that the bid-rent model functions fairly well in its estimates of demand for attributes and in its predictions. It may perform better in some ways than a hedonic-type model in forecasting housing attribute demand.
Publication Name: Journal of Urban Economics
Subject: Government
ISSN: 0094-1190
Year: 1988
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Equilibration in a negotiated market: evidence from housing
Article Abstract:
The process of equilibration in the negotiated housing market is examined and an empirical model is developed. Analysis results indicate that, in order to be accurate, empirical models of housing prices should incorporate the amount of time houses remain on the market before they are sold. Results also indicate that empirical models should contain a simultaneous equations approach that measures the effects of the passage of time on buyers' and sellers' acceptable prices.
Publication Name: Journal of Urban Economics
Subject: Government
ISSN: 0094-1190
Year: 1989
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