Ahlfeldt, Gabriel M. and Holman, Nancy (2015) Distinctively different: a new approach to valuing architectural amenities. SERC discussion papers, SERCDP0171. Spatial Economics Research Centre, London, UK.
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We propose a method to estimate the capitalized value of the architectural design quality of a neighbourhood. Our economic design premium is identified by spatially differentiating property prices and design quality within neighbourhoods and comparing the differences across neighbourhoods. We apply our method to 47 conservation area neighbourhoods in England in which we analyse around 7900 property transactions and interview more than 500 residents. We find a capitalization effect of about 25.4% (£38.7k) associated with a one-step increase on a five-step scale ranging from not at all-distinctive to very distinctive. Our results suggest that this effect is at least partially driven by an architectural externality.
|Item Type:||Monograph (Discussion Paper)|
|Additional Information:||© 2015 The Authors|
|Library of Congress subject classification:||H Social Sciences > HD Industries. Land use. Labor > HD100 Land Use
N Fine Arts > NA Architecture
|Journal of Economic Literature Classification System:||C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory
D - Microeconomics > D2 - Production and Organizations > D23 - Organizational Behavior; Transaction Costs; Property Rights
R - Urban, Rural, and Regional Economics > R5 - Regional Government Analysis > R52 - Land Use and Other Regulations
|Sets:||Research centres and groups > Spatial Economics Research Centre
Collections > Economists Online
|Funders:||Economic and Social Research Council , Department for Business, Innovation & Skills, Welsh Government|
|Date Deposited:||25 Nov 2015 11:47|
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