Professional Documents
Culture Documents
Case Study 4
Case Study 4
Clark SOM
Condo Confusion
By Alex Nicholson
Attached is the Dataset condo.xlsx containing all data and statistical calculations used
to formulate the following regression analysis.
Regression Results
SUMMARY OUTPUT
Regression Statistics
0.8401153
Multiple R 4
0.7057937
R Square 9
Adjusted R 0.6910834
Square 8
9.9045840
Standard Error 4
Observations 106
ANOVA
Significanc
df SS MS F eF
Regression 5 23534.1479 4706.82958 47.9795302 4.4855E-25
Residual 100 9810.07851 98.1007851
Total 105 33344.2264
Data Analysis
I was unsurprised by the direction and magnitude of all of the coefficients in equation, they all
aligned with my assumptions. For each floor higher the condo the price will decrease by $71.50,
meaning that the lower floors are more desirable. For each one unit increase in distance from the
elevator the sale price will decrease by $87.32, this means that being nearer the elevator is
preferable. If the condo has an ocean view it will experience a $3,127.28 increase in sale price,
the ocean view has an extremely large positive relationship with sale price. If the specific unit
has a restricted end view then sale price will decrease by $1,780.78, people are willing to pay
less if the view is restricted. If the condo is already furnished the sale price of the condo is
expected to increase by $998.38, people value not having to provide their own furniture for the
condo.
Once we identify the magnitude and direction of the coefficients it is important to check for
statistical significance. Distance, View, End, and Furnish all have really high T statistics and low
p values resulting in sufficient evidence to confirm that changes in these variables are
statistically significant in determining differences in sale price. The variable for Floor is not
statistically significant due to its lower T statistic and its P-value being > 0.05.
Individual T statistics for significance of each Independent Variable on Condo Price (Y)
15
14.0161022793561
10
5
4.86657021149938
0 -1.34737971101414
-3.56508576725055
-4.47213242833523
-5
-10
Floor Distance View End Furnish
- The most influential factor in determining condo sale price at this oceanside complex
is whether or not the unit has an ocean view.
- The R squared tells us that 70% of the variance in condo sales price can be
accounted for by this model.