An Empirical Study of Residential Hedonic Prices in Nanjing

In this paper, we briefly analyze the theoretical foundation of residential hedonic price model- Lancaster theory of consumer preferences and Rosen´s supply and demand equilibrium model about hedonic market. The residential hedonic price model in this research is set up on the nonlinear relationships between prices and hedonic variables in Rosen´s theory, in which the residential prices were chosen as dependent variables and fourteen independent hedonic variables were chosen from real estate experts´ opinions. Five hundred groups of residential prices and hedonic variables in September, 2009 from Nanjing were collected and input into the model. Ten hedonic variables entered the model and four were refused. The refuse reason is explained and the sign, price elasticity and marginal price of ten entering hedonic variables are discussed.