1# RECORD 6ba1087eea411b2f100fdeb063e521295b5d112b2# TITLE: Defining the Existence of Housing Submarkets for Terraced Properties in Johor Bahru3# YEAR: 2024.0 VENUE: International Journal of Sustainable Construction Engineering Technology DOI: 10.30880/ijscet.2024.15.01.0044# AUTHORS: Wendy Xin; B. Burhan; Mohd Lizam Mohd Diah5# PAGES: 7 CANDIDATE TABLE PAGES (1-based): []6# ABSTRACT: Recent research on housing submarkets over the decades and the necessity to categorise heterogeneous property markets into distinct submarkets are deemed essential in the real estate field. Housing submarkets operate based on the concept of a group of dwellings that are substantially close substitutes to one another, but are relatively poor substitutes for dwellings in different submarkets. This mechanism primarily depends on spatial variations in housing characteristics related to structure, location, and neighbourhood. Housing submarkets are vital in enhancing the precision of housing pricing and analysing the dynamic shifts in the property markets. This study aimed todefine and examine the presence of housing submarkets for the terraced properties in Johor Bahru with the Malaysian Valuation and Property Services Department (JPPH) housing transaction database. The database documented 63,036 housing transactions between2009 and 2018 with thirteen independent structural and locational housing attributes. The study also recommended an objective data-driven methodology by integrating principal component analysis (PCA) and cluster analysis to delineate housing submarkets. Resultantly, the presence of housing submarkets was identified within the property market with the delineation of two specific submarket effects, namely the housing location cluster and housing quality cluster. The submarkets provided a comprehensive framework for segregating property traits into prospective clusters. Establishing housing submarkets may provide valuable insights, implicit cluster details, and a more reliable hedonic price model prediction. The outcomes could be employed by property valuers, analysts, and urban planners for a sound comprehension of current real estate circumstances.789===== PAGE 1 (score 4, numeric-paren 0, table-words 0, var-words 4) =====1011 12INTERNATIONAL JOURNAL OF SUSTAINABLE 13CONSTRUCTION ENGINEERING AND TECHNOLOGY 14ISSN: 2180-3242 e-ISSN: 2600-7959 15 16IJSCET 17Vol. 15 No. 1 (2024) 41-47 18https://publisher.uthm.edu.my/ojs/index.php/ijscet 19 20 21 22 23© 2024 UTHM Publisher. All rights reserved. 24This is an open access article under the CC BY-NC-SA 4.0 license. 25 26Defining the Existence of Housing Submarkets for 27Terraced Properties in Johor Bahru 28Wendy Lim Wen Xin1*, Burhaida Burhan1, Mohd Lizam Mohd Diah1 291 Department of Real Estate Management, Faculty of Technology Management and Business, 30Universiti Tun Hussein Onn Malaysia, Parit Raja, Batu Pahat, 86400, MALAYSIA 31 32*Corresponding Author: limwendywenxin@gmail.com 33DOI: https://doi.org/10.30880/ijscet.2024.15.01.004 34Article Info 35Abstract 36Received: 28 November 2023 37Accepted: 05 December 2023 38Available online: 26 February 2024 39Recent research on housing submarkets over the decades and the 40necessity to categorise heterogeneous property markets into distinct 41submarkets are deemed essential in the real estate field. Housing 42submarkets operate based on the concept of a group of dwellings that 43are substantially close substitutes to one another, but are relatively 44poor substitutes for dwellings in different submarkets. This mechanism 45primarily depends on spatial variations in housing characteristics 46related to structure, location, and neighbourhood. Housing submarkets 47are vital in enhancing the precision of housing pricing and analysing the 48dynamic shifts in the property markets. This study aimed to define and 49examine the presence of housing submarkets for the terraced 50properties in Johor Bahru with the Malaysian Valuation and Property 51Services Department (JPPH) housing transaction database. The 52database documented 63,036 housing transactions between 2009 and 532018 with thirteen independent structural and locational housing 54attributes. The study also recommended an objective data-driven 55methodology by integrating principal component analysis (PCA) and 56cluster analysis to delineate housing submarkets. Resultantly, the 57presence of housing submarkets was identified within the property 58market with the delineation of two specific submarket effects, namely 59the housing location cluster and housing quality cluster. The 60submarkets provided a comprehensive framework for segregating 61property traits into prospective clusters. Establishing housing 62submarkets may provide valuable insights, implicit cluster details, and a 63more reliable hedonic price model prediction. The outcomes could be 64employed by property valuers, analysts, and urban planners for a sound 65comprehension of current real estate circumstances. 66Keywords 67housing submarkets, housing 68attributes, principal component 69analysis, cluster analysis, spatial 70analysis 711. Introduction 72Property markets substantially facilitate national economies with their feedback relationship. Based on Chin and 73Chau (2003), the high demand for housing properties would catalyse multiple economic sub-sectoral 74advancement and property market expansion across urban and suburban areas (Navaneethan, Ismail and Mar 75Iman, 2009). Given that housing is uniquely heterogeneous following its type, building size, location, 76neighbourhood, and other relevant characteristics (Thevendran and Jarnell, 2019; Mohd Diah et al., 2014; Yang, 772017), one rule does not apply to all due to subtle variances between each housing. In line with past studies, 78housing prices could be typically modelled and summarised with physical, spatial, and environmental elements 79using the hedonic price model (Bourassa, Hoesli and Peng, 2003; Chen et al., 2009; Feng and Jones, 2016). 80Nevertheless, the model might reflect aggregation bias as housing markets are regarded as aggregates (Rosmera 81