Hedonic Regression: The Engine Behind Our Pricing Model

Every property in the Avena Terminal database carries a market price estimate. The model achieves an R-squared of 0.87, meaning it explains 87% of the variance in property prices.

Key Findings

• Location explains approximately 45% of total price variance
• Each additional m2 adds EUR 1,800-2,400 to value
• Each kilometre closer to the coast adds 4-6% to value
• Private pool premium: EUR 35,000-50,000
• A rating energy premium: 5-8%

How We Calculate Discounts

Discount = (Model Estimated Price - Asking Price) / Model Estimated Price x 100. A 19% average discount across the dataset means new builds are priced 19% below model predictions.

Technical methodology note: weighted least squares with robust standard errors, clustered by town.