Statistical Relations of the Qualitative Attributes of Real Properties Subject to Mass Appraisal

Research background: Every real estate may be described with a multitude of attributes. In the process of real estate appraisal only those properties are taken into account that significantly affect its value. Mass appraisal involves a simultaneous valuation of many similar real properties, carried out in the same manner and at the same time. The algorithm applied to mass appraisal ought to ensure a uniform approach to the valuation of all real estate of the same type in an objective fashion.

Purpose: The purpose of the paper is to define the weights of attributes in the process of real estate mass appraisal on the basis of relationships between unit property value and the values of attributes.

Research methodology: The weights were defined on the grounds of partial correlation coefficients for the qualitative properties (Spearman rank correlation coefficient and τ_B Kendall correlation coefficient).

Results: The signs of certain correlation coefficients were discordant with the actual direction of the relations between the analysed properties. The problem was avoided by employing partial correlation coefficients. On the basis of the calculated partial correlation coefficients the weights of individual attributes were calculated. Of all analysed coefficients the partial τ_B Kendall correlation coefficient is methodologically the most suitable one.

Novelty: The use of partial correlation coefficients for determining attribute weights is an innovative approach and is applied in the article.