Determinants of house prices in Turkey: Hedonic regression versus artificial neural network

SELİM H.

EXPERT SYSTEMS WITH APPLICATIONS, vol.36, no.2, pp.2843-2852, 2009 (SCI-Expanded) identifier identifier

  • Publication Type: Article / Article
  • Volume: 36 Issue: 2
  • Publication Date: 2009
  • Doi Number: 10.1016/j.eswa.2008.01.044
  • Journal Name: EXPERT SYSTEMS WITH APPLICATIONS
  • Journal Indexes: Science Citation Index Expanded (SCI-EXPANDED), Scopus
  • Page Numbers: pp.2843-2852
  • Keywords: House price, Hedonic regression, Artificial neural networks, Turkey, MODELS, MARKET, SEGMENTATION, PREDICTION, VARIABLES
  • Dokuz Eylül University Affiliated: Yes

Abstract

Determinants of house prices in Turkey are examined in this paper using the 2004 Household Budget Survey Data. In property valuation and housing market research, the locational value is usually analyzed by hedonic methods that use multiple regression techniques oil large data sets and require a formality based oil microeconomic theory in the analyses. Because of potential non-linearity in the hedonic functions, artificial neural network (ANN) is employed in this study as an alternative method. By comparing the prediction performance between the hedonic regression and artificial neural network models, this study demonstrates that ANN can be a better alternative for prediction of the house prices in Turkey. (c) 2008 Elsevier Ltd. All rights reserved.