Estimating the Effect of Location Externalities on Real Estate Values Using the Delphi Method

The Delphi method is a method of collecting and structuring knowledge from a group of experts using a questionnaire combined with a controlled opinion feedback. The present paper reviews the main principles of the Delphi method, and attempts to validate its results using data obtained by standard econometric techniques of real estate appraisal, such as the hedonic price method. As we argue, the Delphi method may become a useful tool for real estate appraisal for unique cases, such as small communities with relatively few housing sales and transitional economies characterized by developing property markets.