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Hedonic House Price Index
KTH, School of Engineering Sciences (SCI), Mathematics (Dept.), Mathematical Statistics.
2013 (English)Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE creditsStudent thesis
Abstract [en]

Nasdaq OMX Valueguard-KTH Housing Index (HOX) is a hedonic price index that illustrates the price development of condominiums in Sweden, and that is obtained by using regression technique. Concerns have been raised regarding the influence of the monthly fee on the index. Low fee condominiums could be more popular because of the low monthly cost, high fee condominiums tend to sell for a lower price due to the high monthly cost. As the price of a condominium rises the importance of the monthly fee decreases. Because of this the monthly fee might affect the regression that produces the index. Furthermore,housing cooperatives are usually indebted. These loans are paid off by the monthly fee which can be considered to finance a debt that few are aware of.

This issue has been investigated by iteratively estimating the importance of the level of debt in order to find a model that better takes into account the possible impact of the monthly fee on the price development.

Due to a somewhat simplified model that produces index values with many cases of high standard deviation, no conclusive evidence has been found that confirms the initial hypothesis. Nevertheless, converting part of the monthly fee into debt has shown a general improvement of fitting a regression equation to the data. It is therefore recommended that real data on debt in housing cooperatives be tested in Valuegua

Place, publisher, year, edition, pages
2013. , 46 p.
TRITA-MAT-E, 2013:28
National Category
Probability Theory and Statistics
URN: urn:nbn:se:kth:diva-123583OAI: diva2:630452
Subject / course
Mathematical Statistics
Educational program
Master of Science in Engineering - Vehicle Engineering
Physics, Chemistry, Mathematics
Available from: 2013-06-19 Created: 2013-06-13 Last updated: 2013-06-19Bibliographically approved

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