Determinants of Residential Development Prices in Prague
|Author:||Mgr. David Mazáček|
|Year:||2015 - summer|
|Leaders:|| PhDr. Pavel Streblov M.Sc.
|Work type:|| Finance, Financial Markets and Banking
|Awards and prizes:|
|Abstract:||This thesis analyzes the progression and current situation on the Prague new
residential development market. The beggining of the thesis is focused on performance of
new residential development market in Prague and its comparison with other cities in
European union including different housing standards and its economical severity.
Performance analysis and current situation on the market indicate the presence of real
estate bubble in past years on Prague market. This bubble has even deepened the
problems on the market caused by the European economic crisis, however currently
there is slow upsarge on the residential real estate market in Prague. Remaining two
chapters are focused on relations between performance of residential development price
per sqm in Prague and the performance of macroeconomic determinants in the range of
income, financing or subsitutionary housing solution. This relation is explored through the
econometric model, that explains the average aggregate price per sqm of new residential
development in Prague through its macroeconomic determinants and real estate factors.
The whole model is very complex and includes set of explanatory variables from both
offer and demand side. In next step the differentiation in terms of location in Prague is
added. For this reason Prague is divided into four categories of location. The second
chapter of this thesis describes the metodological approach of other authors and
determines key points of metodology used for econometric model done in next chapter.
The third chapter describes dataset used for following econometric model, reliance
between explanatory variables and construction of the model. Underlined is the
construction of response variable and all aspects of model statistical verification.