Dokumentation og international benchmarking af bygge - Danmarks ...

dwelling houses is calculated using the hedonic method with multipleregression techniques.Description of the hedonic methodHedonic methodThe hedonic method is based on market prices and a regression analysis,which describes the relation between the prices and the different characteristicsof the buildings. The departure point for this approach is the assumptionthat there is a relatively stable connection between the overallprices at a given time and the characteristics of the object.If one compare the price of all construction projects for a certain year withprojects carried out the year before, it can appear that prices have gone upby, for example, seven percent. However, it is not assured, that priceshave actually gone up by seven percent. The reason is, that potential differencesin quality and other structural differences have not been takeninto account. In order to consider these aspects, it is necessary to producea statistical model that can make the projects comparable over time. Relevantquality variables are thus included in the statistical model to adjustfor differences in quality.The Norwegian new-detached house index and the Swedish building priceindex for dwellings are both calculated using hedonic methods with multipleregression techniques.The regression modelNorway - The function describing the relationship between the price andthe characteristics can be formulated stochastically:P=a+b 1 x 1 +b 2 x 2 +…+b n x n +εWhere P is the price per square metre, a is a constant, x 1 -x n are the characteristicsor explanatory variables, and b 1 -b n are the price coefficients. The bvalues are estimated once a year based on the last two years data. Observationsfrom both the base year and the year before are used in the regressionanalysis to obtain more confident and stable estimates of the function.Further on, the index is adjusted for seasonal variations applying theX12ARIMA method with non-fixed seasonal effects and using a multiplicativemodel.Sweden - Statistics Sweden has chosen a similar model, but the dependentvariable is now the logarithm of the price of a project per square metre.log(Y) = a + b x + b x + ... + b x k1122kWhere Y is the price of a project per square metre, a is the intercept, b 1-b kare the regression coefficients and x 1-x kare the explanatory variables.91