Construction and the Analysis of the Models of Mass Appraisal of Residential Real Estate in Riga and Daugavpils

Abstract

Mass appraisal of real estate is one of the most classical economic tasks in accomplishing of which econometric modeling is successfully applied. The following article dwells upon three models used for estimating the commercial value of residential real estate. For the purposes of the research the market of residential real estate of two cities (i.e. capital of Latvia - Riga and the regional centre – Daugavpils) has been studied. The statistical analysis of the sales data for 2010-2011 has allowed distinguishing pricing factors of the residential real estate, both at the regional level, and at the level of a building and object of real estate. Modeling was conducted with the use of correlation and regression and cluster analyses. The additive and multiplicative models based on the regression equation and the model of the cluster analysis based on the method of parallel sectioning have been presented