Sunday, February 25, 2018

Rising Local House Prices

The graph shows the percentage premium over the original sales price (when the development was originally marketed) of freestanding houses sold in our development since we bought. Ours is the first datapoint. The most recent sale at auction yesterday establishes a new record premium. The regression model I fitted to the data predicts a price for our house that almost exactly matches my recent upgrade of the value. I use two regressors – the original sale price and the date of the new sale. Premia are higher on the houses that originally had lower sales prices i.e. the smaller houses.

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