Housing submarkets: The case of Ankara metropolitan area

The housing market is an area where housing is produced with the supply and demand mechanism. Due to the heterogeneity in the housing market, this market is better analyzed as different homogeneous groups rather than a single market. These homogeneous groups are defined as submarkets with similar spatial, environmental, spatial and structural characteristics. Housing submarkets are used to predict housing prices and help decision-makers make more conscious decisions. This study aims to discuss the housing submarkets by using the current housing supply in the Ankara housing market. In this context, it examines whether the analysis for the city as a whole reflects a realistic housing price structure in order to understand the housing market. In addition, this study aims to answer the question of whether the socio-economic submarkets based on the average household income in the neighborhoods and the spatial submarkets according to the location of the districts are determinative for the Ankara metropolitan area. Data were collected between January and September 2021 from one of Turkey's largest real estate websites, which provides information on house sales in different neighborhoods of Ankara's nine central districts. The data were analyzed with the hedonic price model. The empirical results show that each submarket has its own dynamics and the housing price structure in each submarket depends on different variables. In this context, it has been seen that housing submarkets are important for Ankara. Another empirical result revealed that the submarkets defined by the location of the districts and the average household income in the neighborhoods affect the the prices of houses in each submarket. In addition, spatial submarkets have more explanatory results for the Ankara metropolitan area than the socio-economic submarkets. This study contributes to housing price studies that ignore market segmentation by revealing new evidence from the Ankara housing market.