Determinants of housing sale prices: A recent spatial econometric application on Sakarya

When the studies on price behavior in the housing market are examined, it is seen that many cost and demand factors such as land size or equipment of the house have gained importance in determining the prices in the relevant market. In the context of prices, spatial ties are important. The spatial interdependence of prices comes from a variety of factors. These are factors such as incomplete information on the market, transaction costs, monopolistic trends and infrastructure changes. In this context, it is likely that there will be serious price similarities or spatial correlations in Sakarya province. The aim of this study is to investigate the spatial dependencies of housing prices in Sakarya province. In other words, to determine the effect of proximity on housing prices. In addition, other factors determining the price of housing are discussed in this study. The data used in the study were randomly selected as 347 units from 3595 houses with stratified sampling method. Data are getting from March to May 2018 period. Data are obtained from real estate sites that have reliable web resources in the field. Spatial econometric methods were used to test the spatial correlation. As a result of these approaches, the existence of spatial correlation was determined. Spatial correlation was determined positively. There is evidence of factors such as infrastructural changes such as road construction that determine housing price behavior and do not exist in traditional models. In addition, it can be said that the implementation of different zoning practices of municipalities in Sakarya scale can create this effect. Inadequate competition in the housing market, a monopolistic market, rising costs and rising tax rates are the main reasons for rising housing prices in Sakarya. The state needs to play an active role in the market and produce alternatives in order to prevent the rise in housing prices and to increase the demand for housing. On the other hand, it can prevent the reflection of the housing prices by decreasing the tax rates taken from the houses.