ABSTRACT
This chapter aims to expand the spatial dynamics of a typical UK housing market by evaluating the influence of specific locational externalities using the multi-level specification. Four levels of resolution have been defined for this purpose: the property level, the (sub)-street level, the Housing Condition Survey Area level and the community level. The most influential variable is again floor area, with the model also revealing the separate market conditions for detached housing. The chapter shows how locational attributes influence house prices, and how these vary within the built environment. By building a multi-level hedonic model for the Inner Area of Cardiff, the locational attributes were allowed to vary at different spatial levels. This permitted the locational attributes to enter the house price determination process at the correct level. The chapter explores how the impact of locational externalities varies across the Inner Area, and how they interact with the housing stock.
