Title: Bare ownership evaluation. Hedonic price model vs. artificial neural network

Authors: Pierluigi Morano; Francesco Tajani

Addresses: Department of Science of Civil Engineering and Architecture, Polytechnic of Bari, Via Orabona 4, 70125 Bari, Italy ' Department of Civil Engineering, University of Studies of Salerno, Via Giovanni Paolo II 132, 84084, Fisciano (SA), Italy

Abstract: In the current downturn of European real estate market, the sale of the bare ownership is creating a growing interest of market operators. The attention to this formula is not only local, but also comes from foreign investors, attracted by the substantial saving on the purchase price, the revaluation of the property over time, as well as the breakdown of the tax burden and the costs of management and maintenance. The aim of this research is, first of all, to deepen the knowledge of the bare ownership market of residential properties. Secondly, it is to develop an effective tool for estimating the bare ownership. Therefore, on the same database and with reference to the same explanatory variables of the price of bare ownership, two estimation models are implemented, one based on hedonic prices theory and another using artificial neural networks (ANN), in order to compare the respective performance.

Keywords: bare ownership price; hedonic price models; artificial neural networks; ANNs; housing market; estimation modelling; Europe; real estate market; residential properties.

DOI: 10.1504/IJBIDM.2013.059263

International Journal of Business Intelligence and Data Mining, 2013 Vol.8 No.4, pp.340 - 362

Published online: 28 Jun 2014 *

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