Analysis of Real Estate Prices Using Geospatial Data

Abstract

The effect of space on real estate prices is critical due to the inherent nature of real estate properties. There exist numerous methodologies in order to incorporate the effect of space into the analysis including the addition of district variables or the use spatial econometric models. Spatial models help with the identification and inference problems compared to the simple hedonic models, yet are harder to work with due to their complexity and resource requirements. In this study, using geospatial data, the authors explain the spatial econometric models and tools available for the analysis of cross sectional real estate data.