Calculation of price dynamic indices on the basis of monitoring real estate market

Abstract

The article proposes an approach to analyzing the dynamics of real estate prices by separating the influence of spatial and temporal factors in a hedonic model. The author speaks in favour of this particular approach because structure and characteristics of properties sold on the real estate market are changing in each period. The task of ensuring time-series comparability (when data is correlated period-to-period) for the model in question is considered completed, if the location factor is taken into account by means of georeferencing, and the impact of location on property value is estimated by cadastre valuation methods. Implementation of this approach requires adequate information support based on system of monitoring real estate market in individual transactions. Analysis of price dynamics is just one of the applications of this system. The author supports analytical value such observation in managerial decision making for improving transparency of real estate market, perfecting valuation activities, advancing mechanism of property taxation and stabilizing the mortgage system.