The Real Estate Market as a Market for Alternative Financial Investments

This bachelor's work is the first study devoted to the residential real estate market in New Moscow. The study is aimed at identifying price factors influencing the market value of 1 sq. m. of residential real estate. The analysis is carried out on cross-sectional data using hedonic regression with 9 independent variables. Next, the data is converted into panel data and, based on it, using regression analysis, the market value of 1 sq. m. of housing is predicted for April 2025. In particular, three models are built: a pooled OLS regression model, a fixed effects model (FE model) and a random effects model (RE model). According to the results obtained, with an increase in the area of the apartment by 1 sq. m. its market value decreases by about 1,600 rubles per sq. m. However, the number of rooms still increases the value of the property, which may be explained by the fact that the sample, for example, contains three-room apartments with a smaller total area than two-room apartments. It was also revealed that each additional kilometer away from the Moscow Ring Road makes the market value of the apartment lower by 2700 rubles per sq. m. In addition, flats that do not have the status of apartments are valued more than flats that have this status. The presence of parking and a balcony negatively affect the market value of the flat. This can be explained by the fact that the sample contains a significant number of flats without a parking space and a balcony, or these properties are located in cheaper (or distant) areas of New Moscow. The floor on which the flat is located and the height of the ceilings turned out to be insignificant variables. The best forecasting model was a random effects model with time effects added. The result of the forecast was the fact that by April 2025 the market value of 1 sq. m. flats in a new building in New Moscow will decrease by about 11%.