Housing Submarkets Research Articles

Market Structure and the Price of Housing Services

While many aspects of housing markets have been extensively analysed, little empirical work has been undertaken on the supply of housing services. Despite this dearth of information, many researchers have characterised the supply of housing as being competitive. It is the intent of this article, therefore, to open up the discussion of the supply of housing services and to examine the extent of sellers' market concentration over a set of multifamily rental housing submarkets. New data on sellers' concentration are presented. A model to determine the effect of non-competitive firm behaviour on the price of housing services is specified and estimated. Results support the hypothesis that the supply of housing services may not be perfectly competitive.

Black and White Preferences for Neighborhood Racial Composition

The research investigates the existence, nature and magnitude of the preferences of races to voluntarily “self‐segregate” into particular areas of urban housing markets. Housing market theory is employed to develop a model showing how housing price variations within a group can provide unambiguous evidence of their preferences for neighborhood racial composition. The model is operationalized in a multiple regression specification wherein the variations in a given racial group's housing prices become a function of the dwelling's attributes and the attributes of the neighborhood (including quality, status, stability and density) as well as housing submarket location and racial composition. The size and statistical significance of the coefficient of the last attribute provides the evidence sought.The regressions are estimated using two micro‐household data bases from St. Louis (1967) and Wooster, Ohio (1975), and results compared. Results show that St. Louis black owners had an aversion to larger black proportions within black submarket neighborhoods, with .7% lower housing prices associated with a 1% higher percentage black. Racial effects for black owners in preponderantly white areas and for black renters in all areas were statistically insignificant. St. Louis whites of both tenures did not demonstrate aversion to neighborhoods with higher percentages of blacks as long as they remained 25% black or less. In areas 25–50% black, however, white prices were 1.5% lower for owners and 3.2% lower for renters per 1% higher proportion black. Such associations continued in majority‐black areas, although the magnitudes of the price effect became progressively smaller. Wooster whites showed an aversion to living in neighborhoods having even a few percent of blacks, with prices 11% lower for owners and 7% lower for renters in such areas compared to all‐white ones.

HOUSING SUBMARKETS WITHIN URBAN AREAS: DEFINITIONS AND EVIDENCE*

Journal of Regional ScienceVolume 21, Issue 2 p. 175-185 HOUSING SUBMARKETS WITHIN URBAN AREAS: DEFINITIONS AND EVIDENCE* Allen C. Goodman, Allen C. Goodman Assistant Professor of Political Economy, The Johns Hopkins University.Search for more papers by this author Allen C. Goodman, Allen C. Goodman Assistant Professor of Political Economy, The Johns Hopkins University.Search for more papers by this author First published: May 1981 https://doi.org/10.1111/j.1467-9787.1981.tb00693.xCitations: 79 * I would like to thank John Quigley, Guy Orcutt, Eric Hanushek, and James Dana for their comments and A. Thomas King for use of his data. The research was financed in part by the Department of Housing and Urban Development (Grant H-2304). The conclusions do not represent those of HUD. Remaining errors are also my responsibility. AboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onFacebookTwitterLinked InRedditWechat Citing Literature Volume21, Issue2May 1981Pages 175-185 RelatedInformation

Spatial aspects of intraurban migration behaviour in a mixed housing market.

This paper examines the validity of J S Adams's propositions concerning the spatial properties of overt migration behaviour in the context of a British city (that is, Birmingham) with a significant public housing sector. Samples of migration moves associated with separate housing submarkets, identified on the basis of tenure/dwelling type criteria, are tested for sectoral, directional, and distance biases. Mean movement distances are computed to measure distance bias, and sectoral and directional biases are assessed by two move-angle models: (1) a uniform vacancy model, and (2) a weighted vacancy model which controls for the effects of a vacancy surface on migration patterns. In general, the results suggest that support for Adams's propositions is limited to moves associated with submarkets either in the private or in the public housing sectors characterized by relatively high levels of tenure security. It is concluded that locational preferences usually assume a low priority in migration decisionmaking when households are only temporarily committed to their current dwellings.

Hedonic prices and composite commodities

In this paper we conjecture and, to an extent, prove that recently noted restrictions required for the logical coherence and empirical relevance of hedonic price models make these models no more general than traditional housing services models. In particular, intra-urban variation in hedonic prices may not be substantively related to market equilibration at all, and therefore is not evidence for the existence of housing sub-markets. Moreover, in the case of jointly produced housing characteristics, the hedonic price models are found to be less general than the traditional homogeneous housing services models.

Homeownership Cost Trends

House price trends for San Francisco Bay area neighborhoods are only partially explained by the set of variables commonly used to assess house price levels. It is likely that such nonmarket factors as local building restrictions, differential mortgage financing policies, and real-estate agent behavior contribute to the relative inability of the cross-sectional model to predict change. In addition, the relationship of independent variables to price change shows great variation among different housing submarkets, casting doubt on the assumption that elasticities derived by a hedonic study for the metropolitan area as a whole represent the utility functions of buyers within more limited housing submarkets.

Class-monopoly rent, finance capital and the urban revolution

Harvey D. (1974) Class-monopoly rent, finance capital and the urban revolution, Reg. Studies 8, 239–255. This paper seeks to establish the significance of class-monopoly rent to the urbanization process. The concept of “class-monopoly rent” describes any situation in which the rate of return to a class of providers of an urban resource (such as housing) is set by the outcome of conflict with a class of consumers of that resource. The Baltimore case shows that such situations are structured by the policies of various financial institutions and that geographically distinct housing sub-markets—within which identifiable community groups live—are created as a result. Residential differentiation is thus necessary to the realization of class-monopoly rent, and class-monopoly rent provides the necessary incentive structure for the urbanization process to proceed. The process can become unbalanced because there are multiplier effects internal to it (speculation in the inner city can increase the demand for suburba...

Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition

A class of differentiated products is completely described by a vector of objectively measured characteristics. Observed product prices and the specific amounts of characteristics associated with each good define a set of implicit or "hedonic" prices. A theory of hedonic prices is formulated as a problem in the economics of spatial equilibrium in which the entire set of implicit prices guides both consumer and producer locational decisions in characteristics space. Buyer and seller choices, as well as the meaning and nature of market equilibrium, are analyzed. Empirical implications for hedonic price regressions and index number construction are pointed out.