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| A Neural Network Analysis of the Effect
of Age on Housing Values Author: A. Quang Do and G. Grudnitski Start Page: 253 Abstract: Empirical studies
using multiple regression find the value of a residential property declines with its age.
Because these results confirm the fact of physical deterioration of a house over time,
little attention is paid to the statistical technique's inherent shortcomings.
Accordingly, this paper uses a neural network, which is able to overcome multiple
regression's methodological problems, to re-examine the effect of age on a house's value.
We find that a negative relationship of value to age holds only for the first sixteen to
twenty years of the life of a house. Then, not only does the decline in value stop, but a
house actually starts to experience appreciation related, in part, to its lot size. |
