Bayesian quantile regression analysis of Korean Jeonse deposit

Eun Jung Nam, Eun Kyung Lee, Man Suk Oh

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

Jeonse is a unique property rental system in Korea in which a tenant pays a part of the price of a leased property as a fixed amount security deposit and gets back the entire deposit when the tenant moves out at the end of the tenancy. Jeonse deposit is very important in the Korean real estate market since it is directly related to the residential property sales price and it is a key indicator to predict future real estate market trend. Jeonse deposit data shows a skewed and heteroscedastic distribution and the commonly used mean regression model may be inappropriate for the analysis of Jeonse deposit data. In this paper, we apply a Bayesian quantile regression model to analyze Jeonse deposit data, which is non-parametric and does not require any distributional assumptions. Analysis results show that the quantile regression coefficients of most explanatory variables change dramatically for different quantiles. The regression coefficients of some variables have different signs for different quantiles, implying that even the same variable may affect the Jeonse deposit in the opposite direction depending on the amount of deposit.

Original languageEnglish
Pages (from-to)489-499
Number of pages11
JournalCommunications for Statistical Applications and Methods
Volume25
Issue number5
DOIs
StatePublished - 2018

Bibliographical note

Funding Information:
This research was supported by Basic Science Research Program through the National Research Foundation of Korea (NRF) funded by the Ministry of Education, Science and Technology (No. NRF-2016R1A2B4008914).

Funding Information:
This research was supported by Basic Science Research Program through the National Research Foundation of Korea (NRF) funded by the Ministry of Education, Science and Technology (No. NRF-2016R1A2B4008914)

Publisher Copyright:
© 2018 The Korean Statistical Society, and Korean International Statistical Society.

Keywords

  • Apartment rent
  • Bayesian analysis
  • Quantile regression
  • Real estate

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