Effect of hierarchical parish system on Portuguese housing rents

Abstract

This manuscript analyzes an inter-parish housing rents gradient with respect to surrounding parishes. Using data on housing rents for 4049 Portuguese parishes in 278 municipalities, the paper explores the spatial patterns of housing rents using the geographically weighted regression (GWR) methodology. The housing rents can be explained by socio-economic factors comprising the effects of unemployment, sustainability, social diversity, elderly dependency, and population density. The proportion of overcrowded dwellings reflecting how poor living conditions affect housing rents was also included in the spatial analysis. On the structural side, characteristics of the dwellings were also included such as the area of the home and the number of other homes available in the parishes. Locational factors reflect households’ valuation for access to other parishes. In order to capture location characteristics, besides considering mobility within municipalities, the GWR allowed using distances to nearby parishes, i.e., parish hierarchy distance effect. The results suggest that the Portuguese rental housing market exhibits a heterogeneous pattern across the territory, displaying spatial variability and a hierarchical space pattern as a consequence of its locational attributes.