Vertical Housing Price Gradient and Ground Floor Premium in Taipei City
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Yu-Hui Chen, Chien-Wen Peng, Chung-Hsien Yang
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International Real Estate Review
This study aims to examine the influence of the floor level on housing prices based on the vertical dimensions of the building. A two stage least squares regression (2SLS) and two stage quantile regression (2SQR) are utilized to analyze the urban regions in Taipei City by using data obtained from the online actual price registry of real estate transactions from August 2012 to April 2020. After considering the spatial autocorrelation, the following conclusions are reached. First, in addition to the ground floor, the floor level premium is 0.55% for residential buildings with an elevator, and the premium increases when the housing price quantile increases. However, for walk-up apartments, there is a floor level discount of -4.21%, and the price discount increases when the quantile for the housing price increases. Secondly, when compared to the other floors, the ground floor premium is 9.61% for residential buildings with an elevator, which is a little higher than walk-up apartments for which the ground floor premium is 8.54%. The results reveal that the influence of the type of residential building and the total number of floors on the ground floor premium is not as high as expected. Finally, regardless of whether the residential buildings have an elevator or are walk-up apartments, the ground floor premium increases when the housing price quantile increases. The ground floor premiums for residential buildings with an elevator range from 7.30% to 11.85%. They are a little higher than those for walk-up apartments which range from 6.25% to 9.69%.
Bid rent, Floor level price premium, Vertical price gradient, Ground floor, Spatial quantile regression