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An Analysis of the Income and Price Elasticity of Demand for Housing in View of Price Dynamics on the Residential Property Market

An Analysis of the Income and Price Elasticity of Demand for Housing in View of Price Dynamics on... AbstractIn both the global and the domestic approach, the real estate market is a multifaceted domain of study, constituting a specific and imperfect system. Researchers have to rely on increasingly advanced analytical tools to capture the structural complexity of real estate markets. Real estate prices are influenced by contradictory behaviors of market participants. This observation prompted the authors to analyze the income and price elasticity of demand for housing by calculating elasticity coefficients in view of changes in housing prices and the Veblen effect. This problem was analyzed based on a review of the literature and the results of an experiment. The results of the current study can be used to confirm the presence of the Veblen effect on the housing market based on the adopted criteria. The coefficients of price and income elasticity of demand for housing were calculated in view of the price dynamics on the real estate market to paint a more complete picture of reality and explain market processes. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Real Estate Management and Valuation de Gruyter

An Analysis of the Income and Price Elasticity of Demand for Housing in View of Price Dynamics on the Residential Property Market

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Publisher
de Gruyter
Copyright
© 2021 Justyna Brzezicka et al., published by Sciendo
ISSN
1733-2478
eISSN
2300-5289
DOI
10.2478/remav-2021-0032
Publisher site
See Article on Publisher Site

Abstract

AbstractIn both the global and the domestic approach, the real estate market is a multifaceted domain of study, constituting a specific and imperfect system. Researchers have to rely on increasingly advanced analytical tools to capture the structural complexity of real estate markets. Real estate prices are influenced by contradictory behaviors of market participants. This observation prompted the authors to analyze the income and price elasticity of demand for housing by calculating elasticity coefficients in view of changes in housing prices and the Veblen effect. This problem was analyzed based on a review of the literature and the results of an experiment. The results of the current study can be used to confirm the presence of the Veblen effect on the housing market based on the adopted criteria. The coefficients of price and income elasticity of demand for housing were calculated in view of the price dynamics on the real estate market to paint a more complete picture of reality and explain market processes.

Journal

Real Estate Management and Valuationde Gruyter

Published: Dec 1, 2021

Keywords: income elasticity of demand for housing; price elasticity of demand for housing; Veblen effect; luxury goods; D01; D12; D19; R00; R21

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