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Using Multiperiod Variables in the Analysis of Home Improvement Decisions by Homeowners
Author(s) -
Baker Kermit,
Kaul Bulbul
Publication year - 2002
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/1540-6229.00051
Subject(s) - renting , property value , stock (firearms) , economics , unit (ring theory) , value (mathematics) , demographic economics , rental housing , public economics , business , actuarial science , labour economics , finance , geography , engineering , psychology , computer science , real estate , civil engineering , mathematics education , machine learning , archaeology
Though approaching $200 billion a year, spending by homeowners and rental property owners on improvements and repairs to the stock of existing housing units has received little attention in the academic literature. Historically, studies of the determinants of home improvements have focused heavily on the static characteristics of the housing unit (age, value, size, location) and of the occupants (age, income, household composition). This article extends this inquiry by incorporating dynamic factors, namely changes in the composition of the household and previous spending on home improvements. The results of these enhancements are encouraging. Additions of household members and having recently undertaken a major home improvement project are significantly related to home expansion projects.