An Analysis of Factors Affecting the Housing Market of San Jose Using MLR Model

Research Article
Open access

An Analysis of Factors Affecting the Housing Market of San Jose Using MLR Model

Bo Yang 1*
  • 1 University of California - Santa Cruz    
  • *corresponding author byang48@ucsc.edu
Published on 13 September 2023 | https://doi.org/10.54254/2754-1169/18/20230091
AEMPS Vol.18
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-915371-79-9
ISBN (Online): 978-1-915371-80-5

Abstract

This article seeks to explain the unstable curve of housing prices in San Jose by analyzing the data of factors that may affect the housing market. By previous research conducted by other scholars, we believe there were five major factors which cause the housing prices to fluctuate, which are construction costs, total population, median income, mortgage rates and crime rates. Introducing multiple linear regression (MLR) as an approach to analyze and based on the monthly data of five-years period, from 2015 to 2019, we find an increase of mortgage rates and construction costs can lead to an increase in housing prices and other factors may not affect the housing prices as expected. However, due to lacking monthly data of certain factors like total population, we use other information associated with the factors to find an approximation of the real monthly data. Hence, while the conclusion provides certain explanations of housing prices for the buyers, it is built on many assumptions and may not perfectly fit the real behaviour of the housing market of San Jose.

Keywords:

multiple linear regression, housing market, San Jose

Yang,B. (2023). An Analysis of Factors Affecting the Housing Market of San Jose Using MLR Model. Advances in Economics, Management and Political Sciences,18,320-326.
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References

[1]. Moro, Alessio, and Galo Nuño 2012 Does total-factor productivity drive housing prices? A growth-accounting exercise for four countries. Economics Letters 115 2: 221-224.

[2]. Wei-Shong Lin, et al. 2014 Effects of Socioeconomic Factors on Regional Housing Prices in the USA. International Journal of Housing Markets and Analysis, vol. 7, no. 1, pp. 30-41. ProQuest, https://www.proquest.com/scholarly-journals/effects-socioeconomic-factors-on-regional-housing/docview/1508425885/se-2, doi:https://doi.org/10.1108/IJHMA-11-2012-0056.

[3]. Jud, G. Donald, and Daniel T. Winkler 2002 The dynamics of metropolitan housing prices." The journal of real estate research 23.1: 29-46.

[4]. Potepan, Michael J 1996 Explaining intermetropolitan variation in housing prices, rents and land prices. Real Estate Economics 24.2: 219-245.

[5]. Goodman, Allen C., and Masahiro Kawai 1982 Permanent income, hedonic prices, and demand for housing: New evidence. Journal of Urban Economics 12.2: 214-237.

[6]. Haurin, Donald R., and David Brasington. 1996 School quality and real house prices: Inter-and intrametropolitan effects. Journal of Housing economics 5.4: 351-368.

[7]. Goodman, Allen C 1977 A comparison of block group and census tract data in a hedonic housing price model." Land Economics 53.4: 483-487.

[8]. Reichert, Alan K 1990 The impact of interest rates, income, and employment upon regional housing prices. The Journal of Real Estate Finance and Economics 3.4: 373-391.

[9]. Rizzo, Mario J 1979 The effect of crime on residential rents and property values. The American Economist 23.1: 16-21.

[10]. Katzman, Martin T 1980 The contribution of crime to urban decline. Urban Studies 17.3: 277-286.

[11]. Katz, Lawrence, and Kenneth T. Rosen 1987 The interjurisdictional effects of growth controls on housing prices. The Journal of Law and Economics 30.1: 149-160.

[12]. Shimizu, Chihiro, Kiyohiko G. Nishimura, and Tsutomu Watanabe 2010 Housing prices in Tokyo: A comparison of hedonic and repeat sales measures. Jahrbücher für Nationalökonomie und Statistik 230.6: 792-813.

[13]. Ham, Charlotte, et al 2012 Accounting for heterogeneity of public lands in hedonic property models. Land Economics 88.3: 444-456

Cite this article

Yang,B. (2023). An Analysis of Factors Affecting the Housing Market of San Jose Using MLR Model. Advances in Economics, Management and Political Sciences,18,320-326.

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About volume

Volume title: Proceedings of the 2023 International Conference on Management Research and Economic Development

ISBN：978-1-915371-79-9(Print) / 978-1-915371-80-5(Online)
Editor：Canh Thien Dang, Javier Cifuentes-Faura
Conference website: https://2023.icmred.org/
Conference date: 28 April 2023
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.18
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. Moro, Alessio, and Galo Nuño 2012 Does total-factor productivity drive housing prices? A growth-accounting exercise for four countries. Economics Letters 115 2: 221-224.

[2]. Wei-Shong Lin, et al. 2014 Effects of Socioeconomic Factors on Regional Housing Prices in the USA. International Journal of Housing Markets and Analysis, vol. 7, no. 1, pp. 30-41. ProQuest, https://www.proquest.com/scholarly-journals/effects-socioeconomic-factors-on-regional-housing/docview/1508425885/se-2, doi:https://doi.org/10.1108/IJHMA-11-2012-0056.

[3]. Jud, G. Donald, and Daniel T. Winkler 2002 The dynamics of metropolitan housing prices." The journal of real estate research 23.1: 29-46.

[4]. Potepan, Michael J 1996 Explaining intermetropolitan variation in housing prices, rents and land prices. Real Estate Economics 24.2: 219-245.

[5]. Goodman, Allen C., and Masahiro Kawai 1982 Permanent income, hedonic prices, and demand for housing: New evidence. Journal of Urban Economics 12.2: 214-237.

[6]. Haurin, Donald R., and David Brasington. 1996 School quality and real house prices: Inter-and intrametropolitan effects. Journal of Housing economics 5.4: 351-368.

[7]. Goodman, Allen C 1977 A comparison of block group and census tract data in a hedonic housing price model." Land Economics 53.4: 483-487.

[8]. Reichert, Alan K 1990 The impact of interest rates, income, and employment upon regional housing prices. The Journal of Real Estate Finance and Economics 3.4: 373-391.

[9]. Rizzo, Mario J 1979 The effect of crime on residential rents and property values. The American Economist 23.1: 16-21.

[10]. Katzman, Martin T 1980 The contribution of crime to urban decline. Urban Studies 17.3: 277-286.

[11]. Katz, Lawrence, and Kenneth T. Rosen 1987 The interjurisdictional effects of growth controls on housing prices. The Journal of Law and Economics 30.1: 149-160.

[12]. Shimizu, Chihiro, Kiyohiko G. Nishimura, and Tsutomu Watanabe 2010 Housing prices in Tokyo: A comparison of hedonic and repeat sales measures. Jahrbücher für Nationalökonomie und Statistik 230.6: 792-813.

[13]. Ham, Charlotte, et al 2012 Accounting for heterogeneity of public lands in hedonic property models. Land Economics 88.3: 444-456

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