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Dynamism of the housing rental market in Guayaquil, Ecuador: an empirical analysis

Abstract:

The dynamics of housing prices in developing countries continue to be understudied. The main reason is the lack of availability of publicly accessible data. Therefore, in this study, we analyze the factors that affect home prices in Guayaquil, Ecuador. We use an innovative strategy to collect information on rental prices and the variables that control their dynamics. We use the two-stage quantile regression approach to consider the heterogeneity of the families and the spatial effects exclusively present in this type of study. The main findings show that the effects (of the independent variables) on rental prices depend on the sub-market and type of residence. For example, the square meters of construction are significant only in the 50 and 75 quantiles, and the effect is more significant in the residence type “house.” The “number of bathrooms” mainly affects houses, not apartments. Urban parks revalue house prices only in the highest quantile. The Salado estuary does not affect apartment prices; however, there is a negative effect on house rentals.