Conserving History

The focus of my analysis was to determine if houses located within a conservation or historic district, in Oak Cliff, command a higher selling price than homes outside of a designated area. To complete this analysis 459 sales were analyzed with a hedonic model over a one year time period. Using the reported sales price based on MLS data, the hedonic model was able to explain approximately 70% of the final selling price. However, there was potentially an issue with heteroskedasticty based on the residual plot. Seeking to mitigate this issue, I used the natural log of the sales price, effectively converting the quantities to percentages. This increased the explanatory power of the model by 6%. Using the natural log method, houses within a conservation or historic district command roughly a 40% premium to similar houses outside of an officially designated area.