Valuation Office Agency
Communities and Local Government
Greg Hands (Hammersmith and Fulham, Conservative)
To ask the Secretary of State for Communities and Local Government what the multiple regression formula used as part of the Valuation Office Agency's Automated valuation model is; and what each variable in the model is.
Phil Woolas (Minister of State (Local Government & Community Cohesion), Department for Communities and Local Government; Oldham East and Saddleworth, Labour)
The Valuation Office Agency's (VOA) automated valuation model (AVM) is designed to use sales to determine the relationship between sale price and property attributes, so that it may subsequently be used to predict property values from recorded property attribute data. The agency's multiple regression models have a log linear structure and the calibrated multiple regression formula looks like this:
Ln (Y) = a + b1X1 + b2X2 + b3X3 . . .
Y = Property price
Ln = Natural logarithm
Xl,2,3 = Property attribute 1,2,3 etc
b1,2,3 = Coefficient 1,2,3 etc
a = Constant
Variables in the model are derived from the property attribute data and will differ by billing authority area. Details of variables could be provided only at disproportionate cost.