Implicit pricing of urban green space using Hedonic Pricing: (Case study: karaj, Jahanshahr region)
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Abstract
Environmental characteristics, including the quality of green spaces, constitute one of the determinants of buildings (house & apartment) transaction prices. In this research, impact of urban green space on building's transaction prices (Rials/m2) in Karaj region, District 1 (Jahanshahr), was analyzed. Therefore, a questionnaire concerning building characteristics and transaction prices was developed. The questionnaires were then filled out for all estate agencies in the Jahanshahr region, using all sold building data in 2007. Spatial data and characteristics of green spaces, e.g. percentage of canopy cover, distance to park were measured using aerial photographs and photomap of the study site, as well as Geographic Information System (GIS) software; PCI Geomatica V8.1 and Arc GIS 9/2. Hedonic Pricing Method (HPM), the multivariable regression analysis and stepwise method were then used to estimate a model relating building transaction price to building and green spaces characteristics. Based on the coefficient of determination, the model explained 67 percent of transaction price variability. It is found that green spaces of Jahanshahr parks had a positive and significant impact on transaction price. The result showed that one kilometer distance from the park represented 24 percent decrease in building transaction price. In this study, the impact of building characteristics including apartment floor number, elevator, building size or area, southern facing and the bedroom's number per unit of area on transaction price were found to be significant
(p= 5%). Apartment floor number and elevator had the highest positive and negative effects on transaction price, respectively. The impact of other green space characteristics, e.g. view to park and garden as well as the percentage of canopy cover were appeared positive but insignificant
(p= 5%).
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