Urban residential land rent function: An alternative Muth-Mills model

Ohkawara, Toru

doi:10.1016/0094-1190(85)90007-5

Cited by 5 publications

(3 citation statements)

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“…opportunity cost) and impatience. Thus, it should be no surprise to learn that hedonic pricing models for residential housing often find that, controlling for square footage, distance from the central business district (CBD) is negatively related to housing prices -driven by the well-known, "negative rent gradient" (Muth, 1969;Mills, 1972;Colwell and Sirmans, 1978;Kau and Sirmans, 1979;Ohkawara, 1985;Coulson and Engle, 1987;So et al, 1997;Chau and Ng, 1998). In short, ceteris paribus, workers prefer to live closer to work in order to reduce travel times.…”

Section: Introductionmentioning

confidence: 99%

The value of a floor: valuing floor level in high‐rise condominiums in San Diego

Conroy

Narwold

Sandy

2013

International Journal of Housing Markets and Analysis

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Purpose-This paper aims to analyze the effect of floor level on condominium prices in San Diego, California. The authors determine whether "higher-floor premiums" exist in the condominium market for a large California city. Further, they investigate how the floor premium varies throughout a building, particularly whether it is quadratic and whether there is a "penthouse premium" for top-floor units. Design/methodology/approach-The paper utilizes a data set of 2,395 condominium sales occurring in San Diego between 2006 and the second quarter of 2011. Using hedonic pricing analysis, the authors model the housing price as a function of condominium, building and neighborhood characteristics. Findings-The results suggest that there is a higher-floor premium for condominiums in San Diego. Specifically, an increase in the floor level is associated with about a 2.2 percent increase in sale price. The higher-floor premium appears to be quadratic in price, suggesting that price increases at a decreasing rate above the mean floor level. The authors also find evidence for a penthouse premium, though this effect disappears once "floor" is controlled for in the model. Originality/value-There has been little direct research on the floor effect in condominium prices. The studies that have used floor level as an explanatory variable have been predominately in Southeast Asia. The results suggest that the floor effect is more complex than previously modeled.

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Section: Introductionmentioning

confidence: 99%

The value of a floor: valuing floor level in high‐rise condominiums in San Diego

Conroy

Narwold

Sandy

2013

International Journal of Housing Markets and Analysis

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“…As many cities continue to develop vertically and the number of high-rise buildings continues to increase, the theoretical construction and empirical analysis of the vertical floor premium has become a very important consideration in decision making in the real estate market. Studies on the location value of urban land or real estate based on the bid rent theory are already quite abundant (Alonso, 1964;Mills, 1967;Muth, 1969;Colwell and Sirmans, 1978;Kau and Sirmans, 1979;Ohkawara, 1985;Coulson and Engle, 1987;McMillen, 1996;Gibbons and Machin, 2005;Ahlfeldt and Wendland, 2013). However, earlier studies on the housing price or rent for vertical dimensions are relatively rare (Wong et al, 2011;Conroy et al, 2013;Danton and Himbert, 2018;Liu et al, 2018;Nase et al, 2019).…”

Section: Figurementioning

confidence: 99%

“…In addition, many scholars have further explored the factors that affect urban land use patterns, especially the impact of improved transportation systems (such as highways, railways, and MRT systems) on land use patterns and land rent gradient curves (Mills, 1967;Muth, 1969;Colwell and Sirmans, 1978;Kau and Sirmans, 1979;Ohkawara, 1985;Coulson and Engle, 1987;McMillen, 1996;Gibbons and Machin, 2005;Ahlfeldt and Wendland, 2013).…”

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confidence: 99%

Vertical Housing Price Gradient and Ground Floor Premium in Taipei City

Chen¹,

Peng²,

Yang³

2022

IRER

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This study aims to examine the influence of the floor level on housing prices based on the vertical dimensions of the building. A two stage least squares regression (2SLS) and two stage quantile regression (2SQR) are utilized to analyze the urban regions in Taipei City by using data obtained from the online actual price registry of real estate transactions from August 2012 to April 2020. After considering the spatial autocorrelation, the following conclusions are reached. First, in addition to the ground floor, the floor level premium is 0.55% for residential buildings with an elevator, and the premium increases when the housing price quantile increases. However, for walk-up apartments, there is a floor level discount of -4.21%, and the price discount increases when the quantile for the housing price increases. Secondly, when compared to the other floors, the ground floor premium is 9.61% for residential buildings with an elevator, which is a little higher than walk-up apartments for which the ground floor premium is 8.54%. The results reveal that the influence of the type of residential building and the total number of floors on the ground floor premium is not as high as expected. Finally, regardless of whether the residential buildings have an elevator or are walk-up apartments, the ground floor premium increases when the housing price quantile increases. The ground floor premiums for residential buildings with an elevator range from 7.30% to 11.85%. They are a little higher than those for walk-up apartments which range from 6.25% to 9.69%.

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