IDEAS home Printed from https://ideas.repec.org/a/gam/jlands/v11y2022i5p759-d821423.html
   My bibliography  Save this article

Research on the Measurement Method of Benchmark Price of Rental Housing

Author

Listed:
  • Hao Xi

    (College of Urban and Environmental Sciences, Peking University, Beijing 100871, China)

  • Lin Tang

    (Real Estate Appraisal Center, Peking University, Beijing 100871, China)

  • Changchun Feng

    (College of Urban and Environmental Sciences, Peking University, Beijing 100871, China
    Real Estate Appraisal Center, Peking University, Beijing 100871, China)

Abstract

China’s rental housing market has just started to develop in recent years. It is relatively imperfect and lacks a clear reference for the pricing of rents, which is not fully transparent. A study on the rent formation mechanism of rental housing has policy implications for the construction of a guiding price for the rental housing market and the establishment of a reference basis for the pricing of subsidized housing. Referring to the definition of a benchmark land price, we use data from Beijing to innovatively introduce the concept of benchmark rent. Based on hedonic price theory and the driving factors of benchmark rent, a system of indicators is constructed to explore the mechanism of influencing factors at meso and micro levels on the benchmark rent of market-based rental housing. After LaGrange and robustness tests, it is found that the spatial error model (SEM) is more suitable for benchmark rent determination. We conclude that benchmark rents are affected by spatial relationships caused by spatial heterogeneity and dependency, and that there is significant spatial variation in the factors affecting market-based rental housing benchmark rents. The determination of the benchmark rent can be used as a guiding signal for the market, as a clear signal expectation for the market, government, and tenants.

Suggested Citation

  • Hao Xi & Lin Tang & Changchun Feng, 2022. "Research on the Measurement Method of Benchmark Price of Rental Housing," Land, MDPI, vol. 11(5), pages 1-15, May.
    • Handle: RePEc:gam:jlands:v:11:y:2022:i:5:p:759-:d:821423
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2073-445X/11/5/759/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2073-445X/11/5/759/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Weiping Wu, 2004. "Sources of Migrant Housing Disadvantage in Urban China," Environment and Planning A, , vol. 36(7), pages 1285-1304, July.
    2. JunJie Wu & Richard M. Adams & Andrew J. Plantinga, 2004. "Amenities in an Urban Equilibrium Model: Residential Development in Portland, Oregon," Land Economics, University of Wisconsin Press, vol. 80(1), pages 19-32.
    3. Zhang, Chuanchuan & Jia, Shen & Yang, Rudai, 2016. "Housing affordability and housing vacancy in China: The role of income inequality," Journal of Housing Economics, Elsevier, vol. 33(C), pages 4-14.
    4. Zhuoma Garang & Cifang Wu & Guan Li & Yuefei Zhuo & Zhongguo Xu, 2021. "Spatio-Temporal Non-Stationarity and Its Influencing Factors of Commercial Land Price: A Case Study of Hangzhou, China," Land, MDPI, vol. 10(3), pages 1-27, March.
    5. Dan Luo & Harry van der Heijden & Peter J. Boelhouwer, 2020. "Policy Design and Implementation of a New Public Rental Housing Management Scheme in China: A Step Forward or an Uncertain Fate?," Sustainability, MDPI, vol. 12(15), pages 1-25, July.
    6. Gabriel, Stuart A. & Mattey, Joe P. & Wascher, William L., 2003. "Compensating differentials and evolution in the quality-of-life among U.S. states," Regional Science and Urban Economics, Elsevier, vol. 33(5), pages 619-649, September.
    7. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
    8. Nana Cui & Hengyu Gu & Tiyan Shen & Changchun Feng, 2018. "The Impact of Micro-Level Influencing Factors on Home Value: A Housing Price-Rent Comparison," Sustainability, MDPI, vol. 10(12), pages 1-23, November.
    9. Yusuf, Arief Anshory & Resosudarmo, Budy P., 2009. "Does clean air matter in developing countries' megacities? A hedonic price analysis of the Jakarta housing market, Indonesia," Ecological Economics, Elsevier, vol. 68(5), pages 1398-1407, March.
    10. Youqin Huang, 2004. "Housing Markets, Government Behaviors, and Housing Choice: A Case Study of Three Cities in China," Environment and Planning A, , vol. 36(1), pages 45-68, January.
    11. Karl L. Guntermann & Stefan Norrbin, 1987. "Explaining the Variability of Apartment Rents," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 15(4), pages 321-340, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Guiwen Liu & Jiayue Zhao & Hongjuan Wu & Taozhi Zhuang, 2022. "Spatial Pattern of the Determinants for the Private Housing Rental Prices in Highly Dense Populated Chinese Cities—Case of Chongqing," Land, MDPI, vol. 11(12), pages 1-22, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:rri:wpaper:200803 is not listed on IDEAS
    2. Felix N. Fernando & Dennis R. Cooley, 2016. "An Oil Boom’s Effect on Quality of Life (QoL): Lessons from Western North Dakota," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 11(4), pages 1083-1115, December.
    3. John I. Carruthers & Gordon F. Mulligan, 2013. "Through the Crisis," Economic Development Quarterly, , vol. 27(2), pages 124-143, May.
    4. Dan S. Rickman, 2014. "Assessing Regional Quality of Life: A Call for Action in Regional Science," The Review of Regional Studies, Southern Regional Science Association, vol. 44(1), pages 1-12, Spring.
    5. Partridge, Mark D. & Rickman, Dan S. & Ali, Kamar & Olfert, M. Rose, 2009. "Agglomeration spillovers and wage and housing cost gradients across the urban hierarchy," Journal of International Economics, Elsevier, vol. 78(1), pages 126-140, June.
    6. Marc Audi & Amjad Ali, 2023. "The Role of Environmental Conditions and Purchasing Power Parity in Determining Quality of Life among Big Asian Cities," International Journal of Energy Economics and Policy, Econjournals, vol. 13(3), pages 292-305, May.
    7. Andrew J. Oswald & Stephen Wu, 2011. "Well-Being across America," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1118-1134, November.
    8. Albouy, David & Lue, Bert, 2015. "Driving to opportunity: Local rents, wages, commuting, and sub-metropolitan quality of life," Journal of Urban Economics, Elsevier, vol. 89(C), pages 74-92.
    9. Mohammad Reza Farzanegan & Mehdi Feizi & Hassan F. Gholipour, 2019. "Drought and Property Prices: Empirical Evidence from Iran," MAGKS Papers on Economics 201916, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    10. Dan S. Rickman & Hongbo Wang, 2017. "US regional population growth 2000–2010: Natural amenities or urban agglomeration?," Papers in Regional Science, Wiley Blackwell, vol. 96, pages 69-90, March.
    11. Carlsen, Fredrik & Langset, Bjørg & Rattsø, Jørn & Stambøl, Lasse, 2009. "Using survey data to study capitalization of local public services," Regional Science and Urban Economics, Elsevier, vol. 39(6), pages 688-695, November.
    12. Abildtrup, Jens & Garcia, Serge & Olsen, Søren Bøye & Stenger, Anne, 2013. "Spatial preference heterogeneity in forest recreation," Ecological Economics, Elsevier, vol. 92(C), pages 67-77.
    13. John Winters, 2013. "Differences in quality of life estimates using rents and home values," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 51(2), pages 377-409, October.
    14. Stuart A. Gabriel & Stuart S. Rosenthal, 2004. "Quality of the Business Environment Versus Quality of Life: Do Firms and Households Like the Same Cities?," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 438-444, February.
    15. Jerzy Michalek & Nana Zarnekow, 2012. "Application of the Rural Development Index to Analysis of Rural Regions in Poland and Slovakia," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 105(1), pages 1-37, January.
    16. Yanjiao Song & Chuanyong Zhang, 2020. "City size and housing purchase intention: Evidence from rural–urban migrants in China," Urban Studies, Urban Studies Journal Limited, vol. 57(9), pages 1866-1886, July.
    17. Chen, Yong & Rosenthal, Stuart S., 2008. "Local amenities and life-cycle migration: Do people move for jobs or fun?," Journal of Urban Economics, Elsevier, vol. 64(3), pages 519-537, November.
    18. Eduardo González & Ana Cárcaba & Juan Ventura, 2011. "Quality Of Life Ranking Of Spanish Municipalities," Revista de Economia Aplicada, Universidad de Zaragoza, Departamento de Estructura Economica y Economia Publica, vol. 19(2), pages 123-148, Autumn.
    19. Maribel Mojica & Tesfa Gebremedhin & Peter Schaeffer, 2008. "Valuing Community Attributes in Rural Counties in West Virginia: An Application of Data Envelopment Analysis," Working Papers Working Paper 2008-03, Regional Research Institute, West Virginia University.
    20. Breinlich, Holger & Ottaviano, Gianmarco I.P. & Temple, Jonathan R.W., 2014. "Regional Growth and Regional Decline," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 4, pages 683-779, Elsevier.
    21. Marshall, Elizabeth & Shortle, James, 2005. "Using DEA and VEA to Evaluate Quality of Life in the Mid-Atlantic States," Agricultural and Resource Economics Review, Cambridge University Press, vol. 34(2), pages 185-203, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jlands:v:11:y:2022:i:5:p:759-:d:821423. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.