Which “Greenness” is Valued? Evidence from Green Condominiums in Tokyo
AbstractThis is one of the first researches on price differentials of green buildings in Asia. Using a rich set of data on condominium transactions and mandatory evaluation of environmental performance in Tokyo, we estimate the effects of itemized green scores on transaction prices. Although green condominiums are on average traded at a premium, the premium is mainly attributed to the building age and quality. After controlling for relevant attributes, we find significant price discounts for newly constructed green condominiums. However, green condominiums experience little depreciation at least during the initial years. Using itemized scores, we find that the long-life design mitigates price discounts, but other factors such as the use of eco-friendly materials, renewable energy, water reuse, and greening exacerbate discounts. Several possibilities are discussed including high future maintenance costs of green condominiums.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 23124.
Date of creation: 26 Mar 2010
Date of revision: 02 Jun 2010
sustainability; green building; hedonic pricing; transaction price; residential real estate; Japan;
Find related papers by JEL classification:
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
- R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
- R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-06-18 (All new papers)
- NEP-ENE-2010-06-18 (Energy Economics)
- NEP-ENV-2010-06-18 (Environmental Economics)
- NEP-URE-2010-06-18 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- ¿Se valora más un edificio certificado como eficiente?
by Ana Ramos in Economics for Energy on 2012-05-11 07:57:00
- Zheng, Siqi & Wu, Jing & Kahn, Matthew E. & Deng, Yongheng, 2012. "The nascent market for “green” real estate in Beijing," European Economic Review, Elsevier, Elsevier, vol. 56(5), pages 974-984.
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- Horváth, Áron & Kiss, Hubert János & McLean, Aliz, 2013.
"Hat-e a lakóingatlanok árára az energiahatékonyság?
[Does energy efficiency affect the prices of residential units?]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 1025-1042.
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