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A Methodology for Constructing Vacant Land Price Indices
Author(s) -
Clapp John M.
Publication year - 1990
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 - 10.1111/1540-6229.00522
Subject(s) - metropolitan area , land value , land price , econometrics , land values , value (mathematics) , compromise , property value , economics , hedonic pricing , land use , statistics , agricultural economics , geography , mathematics , real estate , finance , engineering , civil engineering , social science , archaeology , sociology
Existing estimates of movements in vacant land prices are limited to a few metropolitan areas and infrequent time intervals. This paper develops a new methodology for estimating vacant land price trends for subareas within states and metropolitan areas. It utilizes data from a sales ratio study, a large database available in most states. The methodology uses assessed value to control for “hedonic characteristics” associated with the property and its location. A model is developed to correct assessed value for measurement errors. Statistical results for forty‐one Connecticut towns indicate that the model provides a reasonable compromise between data availability and accuracy of price trend estimates.