Robust Determinants of Housing prices in Iran: Bayesian Averaging of Classical Estimates (BACE)

Document Type : Research Article

Authors

1 Lorestan University doctoral student in public sector economics

2 Bu ali Sina University, Hamedan, Iran

Abstract

This study identifies and estimates the effective factors on housing prices over the years 1996 to 2017 in terms of model uncertainty and with BACE approach. The statistical data of 18 variables including 15 external variables (socioeconomic variables) and 3 internal variables (housing sector variables) affecting housing price according to the theoretical foundations and experimental studies have been used for this research. The results suggest that the growth of urban population, household income, the unemployment rate, the average cost of 1-square-meter building, expected inflation, income inequality, oil revenues growth, liquidity, and exchange rate are the most effective variables in housing price pattern in Iran. There is no strong evidence of effectiveness of other variables on housing price over the period of this research. The results can be used for creating appropriate patterns for explaining the issues related to housing price and better management of housing sector policies.

Keywords

References

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Journal of Applied Economics Studies in Iran
Volume 8, Issue 32
January 2020
Pages 49-79

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