Valuing Unit-Specific Amenity Factors of Apartments Using the Ratio of Transaction Price to “Sise”

Abstract

This study estimates the marginal values of detailed amenity factors of apartment condominiums. The conventional way of hedonic approach estimates directly transaction price with several explanatory variables. However, this approach requires a full set of explanatory variables including macro-scale and micro-scale location variables, physical characteristics of housing, and other amenity and disamenity factors. This study uses the ratio of real transaction price to "Sise" as the dependent variable. The use of "Sise" reduces the burden for generation of the full set of explanatory variables, since "Sise" controls the site-specific factors. As a result, This study can focus on unit-specific detailed amenity factors such as landscape view, sunshine, openness, noise, etc. Using the new way of estimation, This study obtained expected directions and reasonable degrees of marginal values for the detailed unit-specific amenity factors.