Work detail

Regional Determinants of Housing Affordability in the Czech Republic

Author: Bc. Peter Smolár
Year: 2016 - summer
Leaders: PhDr. Hana Hejlová
Consultants:
Work type: Bachelors
Language: English
Pages: 35
Awards and prizes:
Link: https://is.cuni.cz/webapps/zzp/detail/164811/
Abstract: The main motivation behind this study lays in identification of regional determinants in the Czech
Republic. Because of lower manifested heterogeneity of apartment in comparison with houses, housing
affordability was measured by a ratio of average buying price of an apartment over average annual
disposable income per capita. Regional housing affordability was judged en bloc and was not measured
in an attempt to identify subpopulations threatened by high housing costs. The object of interest was the
impact of individual dependent variables on the price-to-income ratio. For the purpose of this study, only
factors affecting at the same time housing prices and housing income, either directly or indirectly
through correlation, are taken into consideration. The estimation of our model suggests that
economically and statistically significant are the variables for the relative number of divorces, births or
the proportion of urban population. All of the effects, disregarding only one variable, went in the same
direction as they were expected to go. Also, it was possible to provide an answer to the question whether
inclusion of composite determinants, such as natural population growth, may affect the interpretation of
the results. In accordance with empirical studies on regional housing prices determinants, the study
concludes that inclusion or exclusion of Hl. m. Praha region does not noticeably affect the results of the
estimation.

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