Determining factors effecting housing prices with hedonic model: an application on TRA1 sub-sector

Housing, one of the fundamental rights of individuals, that meets the needs of shelter, is also regarded as a safe investment tool. Housing ownership (ownership of housing) emerges as an indicator of the development level of the societies and as an indicator of the social status of the individuals in their surrounding environment. That is why it is extremely important to know which factors affecting the prices of housing. Housing is a heterogeneous product with many different characteristics. Such properties (features) belonging to the residence constitute the price of the residence. The main objective of this thesis is to analyze the potential effects of residential properties of the houses for sale in the TRA1 region on the housing prices in detail. In order to accomplish this aim, the housing advertisements in the web sites were used as horizontal cross-sectional data and various analyzes were made with the hedonic price model. According to the analysis, the linear model, semi-logarithmic model and full logarithmic model were used as function form. As a result, the width of the residence (m2), the number of rooms and the fact that whether they are located in the city center have been identified as the most important determinants of housing prices in the TRA1 region. In addition, it is also observed that variables such as the province, parking lot within the site, eastern facade, number of floors and bathrooms positively affected the housing prices. It is also determined that the age of the building has impacts on the housing prices in the negative direction.