Which “Greenness” is Valued? Evidence from Green Condominiums in Tokyo

Jiro Yoshida and Ayako Sugiura

MPRA Paper from University Library of Munich, Germany

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.

Keywords: sustainability; green building; hedonic pricing; transaction price; residential real estate; Japan (search for similar items in EconPapers)
JEL-codes: Q51 R21 R31 (search for similar items in EconPapers)
Date: 2010-03-26, Revised 2010-06-02
New Economics Papers: this item is included in nep-ene, nep-env and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:23124

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