Impacts of Urban Decay on the Residential Property Market: An Application to the City of Rome (Italy)

Urban decay is a complex phenomenon that encompasses physical deterioration, environmental degradation, and social disintegration that negatively affects the livability, safety, and economic vitality of urban areas, leading to demographic displacements, disinvestments and significant repercussions on housing dynamics. This study aims to develop a regression methodological approach to determine the effects of urban decay factors on the residential real estate market in Rome (Italy). The methodology involves the collection of a set of variables to describe and interpret the effects of urban decay on property values, followed by the application of Weighted Least Squares (WLS) regression to assess the marginal prices of these identified variables. The use of WLS allows to take into account the problem of heteroscedasticity in the evaluation process, ensuring its robustness. The proposed methodology is adaptable to different spatial contexts and provides valuable decision support for stakeholders involved in urban regeneration initiatives aimed at revitalizing decayed areas.