In this paper, the author examines the development of the spatial distribution of housing\nprices. Due to consumer preferences for access over amenity value, there is a spatial disparity\nof housing prices. According to Alonsoâ��s extension of von T�¼nenâ��s theory, the relationship\nbetween housing prices in urban and rural areas tends to follow certain principles. This\nrelationship is more often negative than positive, i.e. the price of a standardized unit of\nhousing declines with increasing distance from a central business district (CBD). It has been\ndocumented that this relationship is negative for Iceland, as well as in many regions of other\ncountries. It is argued here that this relationship has become increasingly marked in Iceland,\nmost likely due to the altered household preferences and structural changes. A macro panel\ndata set from Iceland will be used, representing several essential variables of the residential\nhousing market for 79 municipalities in Iceland from 1981 to 2006.
Loading....