Listing price estimation of flats in KwaZulu-Natal Coastal sub-markets: a novel econometric model.
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Date
2016
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Abstract
Abstract
The aim of this study was to derive a hedonic price function for flats within KwaZulu-Natal
coastal sub-markets, filling a gap in residential hedonic price studies in South Africa. This
study set out to develop a model to estimate listing prices of flats located in sub-markets
along the KwaZulu-Natal coast. Identifying the appropriate distribution of listing prices and a
set of statistically significant structural and locational attributes was paramount in achieving
the research objectives. This was accomplished through a set of research hypotheses that
were formulated and tested through rigorous statistical techniques. A generalised linear model
based on the gamma distribution and log-link function was developed as a novel alternative
to derive a hedonic price function for a segment of the residential property market in
KwaZulu-Natal. The generalised linear model based on the gamma distribution and log-link
function proved to be a more effective model for this research problem than the traditional
ordinary least squares modelling approach. Based on the findings, a software application was
developed to disseminate the results of the generalised linear model for potential commercial
use by real estate businesses, bridging the gap between academia and business.
Description
Master’s Degree. University of KwaZulu-Natal, Durban.