Interpretation and measurement of the spread between asking and selling prices in the Italian residential market

The lack of transparency in the property market and the resulting difficulty in finding comparables to use in property valuations, very often forces evaluators to substitute the asking prices with the selling prices in the market approach. This alternative is now also accepted by case law but has the limitation of having to quantify, albeit very roughly, the correction to be made in relation to the probable spread between the asking prices, taken as a reference, and future selling prices. The importance of the asking prices to understand the market, is acknowledged in international literature which has mainly focused (starting from the analysis of the prices themselves and the time spent on the market), on the search for the best sales strategies, or on the measurement of the illiquidity of the property market. This study, in an innovative way, also on the basis of the relationships already proven, instead, attempts to interpret and measure the difference between asking and selling prices, in order to build a reference for the adjustments made to the former in estimation practice. The target is pursued through the construction of a multivariate analysis model on a sample taken over a 12-year interval in the city of Potenza, Italy. The analysis allowed to measure and interpret the marginal contribution that macro and microeconomic variables provide to the explanation of the spread under investigation.