The effect of pricing factors on real estate transactions in Prince George's County, Maryland

Abstract

Participants in real-estate transactions involving the purchase of single-family homes consider a variety of factors when establishing a price. These factors include crime, interest rates, income, unemployment, quality of schools, and many other factors. The current quantitative, correlational and multiple regression analysis study examined the empirical relationships among price, crime, interest rates, income, unemployment, and schools in Prince George’s County, Maryland, by examining the contribution of each independent variable to the dependent variable price. Findings indicated that income and unemployment have no significant relationship to price and do not contribute significantly to price of single-family homes. Interest rates, total crime, and school average SAT scores have a significant relationship with price and contribute individually and collectively to the final sales price of single-family homes in Prince George’s County, Maryland. These findings support further research into the relationship and contribution of other independent variables to the price established for single-family homes. The study results have potential implications for the real-estate industry, private-sector leaders, and government officials to improve their leadership effectiveness in managing this aspect of the economy.