Yoshida, Jiro and Sugiura, Ayako (2010): Which “Greenness” is Valued? Evidence from Green Condominiums in Tokyo.
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Abstract
This 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.
| Item Type: | MPRA Paper |
|---|---|
| Original Title: | Which “Greenness” is Valued? Evidence from Green Condominiums in Tokyo |
| English Title: | Which “Greenness” is Valued? Evidence from Green Condominiums in Tokyo |
| Language: | English |
| Keywords: | sustainability; green building; hedonic pricing; transaction price; residential real estate; Japan |
| Subjects: | Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q51 - Valuation of Environmental Effects R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location > R31 - Housing Supply and Markets R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R2 - Household Analysis > R21 - Housing Demand |
| Item ID: | 23124 |
| Depositing User: | Jiro Yoshida |
| Date Deposited: | 08 Jun 2010 21:44 |
| Last Modified: | 26 Sep 2019 08:19 |
| References: | Architectural Institute of Japan. 2000. Architectural Charter for a Global Environment. Tokyo, Japan. California’s Sustainable Building Task Force. 2003. The Costs and Financial Benefits of Green Buildings. Sacramento, California. Eichholtz, Piet M. and Kok, Nils and Quigley, John M. 2010. Doing Well by Doing Good? Green Office Buildings. Forthcoming, American Economic Review. Fuerst, Franz & McAllister, Patrick. 2008. Green Noise or Green Value? Measuring the Price Effects of Environmental Certification in Commercial Buildings. MPRA Paper 11446, University Library of Munich, Germany. Miller, N., Spivey, J. & Florance, A. 2008. Does Green Pay Off? Unpublished Manuscript. Pramerica Real Estate Investors. 2007. To Be Green or Not to Be Green? Why that is Not the Question? RREEF. 2007. The Greening of U.S. Investment Real Estate – Market Fundamentals, Prospects and Opportunities. RREEF. 2008. Globalization and Global Greening Trends in Green Real Estate Investment. RREEF. 2009. How Green a Recession? – Sustainability Prospects in the US Real Estate Industry. Rosen, Sherwin. 1974. Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition, Journal of Political Economy, Vol.82, pp34-55. Yoshida, Jiro, John M. Quigley, and Chihiro Shimizu. 2010. The Effect of Green Building Label on Real Estate Prices: The Case of New Condominiums in Japan. University of Tokyo CSIS Discussion Paper, No. 106. |
| URI: | https://mpra.ub.uni-muenchen.de/id/eprint/23124 |
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