Doutoramento em Economia
Is Energy Efficiency Reflected in Residential Property Prices in Portugal? An Investigation Based on Hedonic House Price Functions and Quantile Regression Analysis
Rui Alexandre Alves Evangelista

Orientação:  Esmeralda Ramalho & João Andrade e Silva & Fernanda Peixe

This thesis investigates the degree to which energy efficiency, as it is assessed by Energy Performance Certificates (EPCs), is reflected in residential property prices in Portugal. Its results are based on the analysis of a comprehensive dataset containing information of around 256 thousand residential property sales carried out from 2009 to 2013, a period largely characterized by depressed market conditions. This is the first large-scale study for a southern European country in this area of research. For the first time in this context, the impact of energy efficiency is analyzed along the distribution of residential property prices, using the unconditional quantile regression framework. The findings disclose a 13% sales premium for most energy efficient apartments (i.e. those bearing an A or B EPC rate) and a 5 to 6% market price premium for houses. However, quantile regression results show that the value attached to energy efficiency is not always positive across the distribution of prices. In particular, houses located at or below the 0.2th price quantile display clear energy efficiency price discounts. The use of different energy efficiency scales and cross-country comparisons support the view that energy efficiency price premiums are higher in the Portuguese residential market than in northern European markets. These results contribute to a more comprehensive understanding of the impact of energy efficiency on the real estate market and provide important messages to all political decision-makers interested in improving energy efficiency standards in Portugal.

Keywords:  Portugal, energy efficiency, residential property market, hedonic price models, cross-country comparisons, quantile regression