Abstract
Housing is more than a living space; it represents a social status capable of promoting several forms and levels of socialization and segregation. Housing is characterized by a set of attributes and functions that are valued differently, in which the consumption of “good housing” is made considering the preferences of their attributes, perceived tangibly/intangibly by the consumers. The reciprocal relation between housing and space, and the lack of structured information capable of apprising the key drivers of such dimensions increase the complexity of understanding the rational mechanisms of evaluating the real housing value. Despite the challenges associated with the modelling of housing markets, urban studies and spatial econometric literature provide a broad (but unfinished) theoretical framework and practical tools that are able to describe, understand, and predict households' housing consumption. Thus, the aim of this chapter is to present concepts and techniques to rationally capture individual and collective housing preferences, and the way in which they interact.
TopHousing Consumption And The Market
Housing plays an important role in developed countries with significant impacts in the overall economy and society; its significant multiplier effects (on employment, prices and consumption), its noteworthy impact on the growth of urban systems, and its impacts on household expenditures (representing the most valuable single asset owned by most individuals), are three reasons to justify the importance of the housing sector as a key driver of quality of life in modern societies (Marques, 2012; Streimikiene, 2015). As an economic good, housing consumption expenses represents 18% of the total final consumption expenditures of households in the EU and housing contributes about 30% to the EU’s 2013 GDP (Gerstberger & Yaneva, 2013).
Key Terms in this Chapter
Spatial Econometric Analysis: Collection of statistical techniques that deal with the particularities of space (heterogeneity and dependence), in this context, useful for accurately describing housing preferences of households.
Spatial Heterogeneity: Occurs when there is a territorial segmentation in the housing market and, therefore, either the preferences associated with different attributes, or the characteristics of the dwellings, are not constant throughout the territory.
Spatial Dependence: When housing values or preferences in a specific location are influenced or correlated by other observations located in the neighbourhood.
Housing Preferences: Refer to certain features any consumer wants to have in a housing (intrinsic attributes or structural characteristics of the property and extrinsic attributes or location characteristics of the property).
Housing Market: Refers to the supply and demand for houses in a particular territory (country, region, or neighbourhood).