Work detail

Determinants of Real Estate Prices in the United States

Author: Bc. Michaela Hronová
Year: 2022 - summer
Leaders: Mgr. Roman Kalabiška
Consultants:
Work type: Bachelors
Language: English
Pages: 82
Awards and prizes:
Link: https://dspace.cuni.cz/handle/20.500.11956/175612
Abstract: This thesis aims to examine the fundamental determinants of real estate prices in the
United States using State level quarterly data over a time period of 21 years. Determinants
from both the supply and demand sides are used for the analysis. After the determination
of non-stationary variables and further confirmation of a single cointegrated relationship
between home values and personal income variables, the ARDL model was implemented.
With the use of the ARDL model, the effect of selected variables on home values was
analyzed as well as the error correction term, which estimates the speed of adjustment
towards the equilibrium following a change in other variables. From the supply factors,
the regression revealed a positive effect of building permits which were significant in all
9 divisions, and a negative effect of homeowner vacancy rates which were significant in
6 divisions. From the demand factors, personal income per capita was identified as the
main determinant together with unemployment, population growth, and marriage rates.
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