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Int. J. Business Intelligence and Data Mining, Vol. 10, No. 2, 2015
Capitalisation rates and ‘real estate semantic chains’: an application of clustering analysis Salvatore Giuffrida*, Giovanna Ferluga and Alberto Valenti Department of Civil Engineering and Architecture, University of Catania, Viale Andrea Doria 6, 95125-Catania, Italy Email: sgiuffrida@dica.unict.it Email: gio.ferluga@virgilio.it Email: albvlt79@gmail.com *Corresponding author Abstract: Ortigia, the historic centre of Syracuse, is a complex urban entity characterised by high outer homogeneity and inner heterogeneity. The evolution of its real estate market during the last decade is somehow related to the global property market one. In addition its events are connected with the evolution of the exploiting policies still ongoing. The critical observations of its features aim at providing tools able to support the decisions about subsidies and local property taxes. This study continues the observations we have carried out for five years, this time involving clustering analysis, a data mining technique able to recognise different submarkets, and suitable to make the valuation pattern fit to the different market areas. For each of the latter significant characteristics have been recognised with reference to the ‘monetary declination’ of these particular capital assets. Keywords: old towns; urban renovation; imperfect real estate markets; mass-appraisals; financial speculative approach; theory of capital; semiotic approach; semantic chains; capitalisation rate; data mining; clustering analysis; hierarchical aggregative algorithm; complete linkage method; dendrogram; root mean square standard deviation. Reference to this paper should be made as follows: Giuffrida, S., Ferluga, G. and Valenti, A. (2015) ‘Capitalisation rates and ‘real estate semantic chains’: an application of clustering analysis’, Int. J. Business Intelligence and Data Mining, Vol. 10, No. 2, pp.174–198. Biographical notes: Salvatore Giuffrida holds a degree in Architecture (1991 University of Palermo, Italy) and a PhD in Assessment of Plan and Project (1997, University of Reggio Calabria). He is a Researcher of Appraisal at the University of Catania since 2001. He has taught economic and environmental appraisals, business management and plan valuation since 1997. He has worked with government agencies, professionals and judges in the evaluation processes for plans, projects, real estate and land, until now. He is a lecturer in several national and international conferences on real estate appraisal, environmental assessment, heritage valuation, and urban renovation. He is the author of several publications on property valuations, public and private investments quantitative and qualitative (multicriteria) analysis.
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