Determinants of Housing Prices in Dalian City, China: Empirical Study Based on Hedonic Price Model
Publication: Journal of Urban Planning and Development
Volume 147, Issue 2
Abstract
Housing price is one of the most popular topics in urban studies. Among all the determinants of housing price, transportation accessibility is an essential factor that people often consider when purchasing a house. Using a semilogarithmic hedonic price model, this paper discusses the effects of structural attributes and accessibility of neighboring destinations on housing prices. The study area targets the core urban area of Dalian city, China. The data used in this study consist of sales prices of commercial apartments and houses and the geographic coordinates of corresponding residential areas. Estimation results of the hedonic price model show that structural attributes and accessibility to neighboring destinations significantly affect housing prices. The most influential factors to housing prices are the location of apartment or house, the nearby quality of higher education resources, and proximity to public transit service. These findings are significant for real estate developers, urban planners, and transportation planners to better understand the real estate market and to promote transit-oriented development.
Get full access to this article
View all available purchase options and get full access to this article.
Acknowledgments
This study is partially supported by the National Natural Science Foundation of China (Grant No. 51478085). The authors wish to thank Professor Yanfeng Ouyang of the University of Illinois at Urbana-Champaign for his insightful suggestions and Mr. Xin Gao of the Dalian University of Technology for helping with data collection.
References
Adair, A. S., J. N. Berry, and W. S. McGreal. 1996. “Hedonic modelling, housing submarkets and residential valuation.” J. Property Res. 13 (1): 67–83. https://doi.org/10.1080/095999196368899.
Alonso, W. 1964. Location and land use: Toward a general theory of land. Cambridge, MA: Harvard Univ. Press.
Ball, M. J. 1973. “Recent empirical work on the determinants of relative house prices.” Urban Stud. 10 (2): 213–233. https://doi.org/10.1080/00420987320080311.
Beijing SouFun Science & Technology Development Co., Ltd. 2016. Real estate internet portal in Dalian City, China. Accessed December 21, 2016. http://dl.fang.com.
Can, A. 1990. “The measurement of neighborhood dynamics in urban house prices.” Econ. Geogr. 66 (3): 254–272. https://doi.org/10.2307/143400.
Can, A. 1992. “Specification and estimation of hedonic housing price models.” Reg. Sci. Urban Econ. 22 (3): 453–474. https://doi.org/10.1016/0166-0462(92)90039-4.
Coulson, N. E., and R. F. Engle. 1987. “Transportation costs and the rent gradient.” J. Urban Econ. 21 (3): 287–297. https://doi.org/10.1016/0094-1190(87)90003-9.
Cui, M., and D. Levinson. 2018. “Full cost accessibility.” J. Transp. Land Use 11 (1): 661–679.
Dalian Statistics Bureau. 2018. Dalian statistical yearbook. Beijing: China Statistics Press.
Dalvi, M. Q., and K. M. Martin. 1976. “The measurement of accessibility: Some preliminary results.” Transportation 5 (1): 17–42. https://doi.org/10.1007/BF00165245.
Day, B., I. Bateman, and I. Lake. 2003. “What price peace? A comprehensive approach to the specification and estimation of hedonic housing price models.” CSERGE Working Paper: EDM, No. 03-08. Norwich, UK: Univ. of East Anglia, Centre for Social and Economic Research on the Global Environment.
Debrezion, G., E. Pels, and P. Rietveld. 2011. “The impact of rail transport on real estate prices: An empirical analysis of the Dutch housing market.” Urban Stud. 48 (5): 997–1015. https://doi.org/10.1177/0042098010371395.
Dorantes, L. M., A. Paez, and J. M. Vassallo. 2011. “Analysis of house prices to assess economic impacts of new public transport infrastructure: Madrid Metro Line 12.” Transp. Res. Rec. 2245 (1): 131–139. https://doi.org/10.3141/2245-16.
Efthymiou, D., and C. Antoniou. 2013. “How do transport infrastructure and policies affect house prices and rents? Evidence from Athens, Greece.” Transp. Res. Part A Policy Pract. 52: 1–22. https://doi.org/10.1016/j.tra.2013.04.002.
Freeman, A. M., III. 1979. “The hedonic price approach to measuring demand for neighborhood characteristics.” In The economics of neighborhood, edited by D. Segal, 191–217. Cambridge, MA: Academic Press.
Geurs, K. T., and B. van Wee. 2004. “Accessibility evaluation of land-use and transport strategies: Review and research directions.” J. Transp. Geogr. 12 (2): 127–140. https://doi.org/10.1016/j.jtrangeo.2003.10.005.
Guo, Y., S. Agrawal, S. Peeta, and S. Somenahalli. 2016. “Impacts of property accessibility and neighborhood built environment on single-unit and multiunit residential property values.” Transp. Res. Rec. 2568 (1): 103–112. https://doi.org/10.3141/2568-15.
Habib, M. A., and E. J. Miller. 2008. “Influence of transportation access and market dynamics on property values: Multilevel spatiotemporal models of housing price.” Transp. Res. Rec. 2076 (1): 183–191. https://doi.org/10.3141%2F2076-20.
Haider, M., and E. J. Miller. 2000. “Effects of transportation infrastructure and location on residential real estate values: Application of spatial autoregressive techniques.” Transp. Res. Rec. 1722 (1): 1–8. https://doi.org/10.3141/1722-01.
Hansen, W. G. 1959. “How accessibility shapes land use.” J. Am. I. Planners 25 (2): 73–76.
Henneberry, J. 1998. “Transport investment and house prices.” J. Prop. Valuation Investment 16 (2): 144–158. https://doi.org/10.1108/14635789810212913.
Iacono, M., and D. Levinson. 2011. “Location, regional accessibility, and price effects: Evidence from Home Sales in Hennepin County, Minnesota.” Transp. Res. Rec. 2245 (1): 87–94. https://doi.org/10.3141/2245-11.
Kockelman, K. M. 1997. “Effects of location elements on home purchase prices and rents in San Francisco Bay Area.” Transp. Res. Rec. 1606: 40–50. https://doi.org/10.3141/1606-06.
Krizek, K. J. 2006. “Two approaches to valuing some of bicycle facilities’ presumed benefits: Propose a session for the 2007 National Planning Conference in the City of Brotherly Love.” J. Am. Plann. Assoc. 72 (3): 309–320. https://doi.org/10.1080/01944360608976753.
Martínez, L. M., and J. M. Viegas. 2009. “Effects of transportation accessibility on residential property values: Hedonic price model in the Lisbon, Portugal, metropolitan area.” Transp. Res. Rec. 2115 (1): 127–137. https://doi.org/10.3141/2115-16.
Mayor, K., S. Lyons, D. Duffy, and R. S. Tol. 2012. “A hedonic analysis of the value of rail transport in the Greater Dublin Area.” J. Transp. Econ. Policy 46 (2): 239–261.
Mitra, S. K., and J.-D. M. Saphores. 2016. “The value of transportation accessibility in a least developed country city—The case of Rajshahi City, Bangladesh.” Transp. Res. Part A Policy Pract. 89: 184–200. https://doi.org/10.1016/j.tra.2016.05.002.
Mulley, C., and C.-H. P. Tsai. 2016. “When and how much does new transport infrastructure add to property values? Evidence from the bus rapid transit system in Sydney, Australia.” Transp. Policy 51: 15–23. https://doi.org/10.1016/j.tranpol.2016.01.011.
Mulley, C., and C.-H. P. Tsai. 2017. “Impact of bus rapid transit on housing price and accessibility changes in Sydney: A repeat sales approach.” Int. J. Sustainable Transp. 11 (1–5): 3–10. https://doi.org/10.1080/15568318.2015.1106223.
NBSC (National Bureau of Statistics of China). 2018. China statistical yearbook 2018. Beijing: NBSC.
Osland, L., and I. Thorsen. 2008. “Effects on housing prices of urban attraction and labor-market accessibility.” Environ. Plann. A Econ. Space 40 (10): 2490–2509. https://doi.org/10.1068/a39305.
Park, J. H., D. K. Lee, C. Park, H. G. Kim, T. Y. Jung, and S. Kim. 2017. “Park accessibility impacts housing prices in Seoul.” Sustainability 9 (2): 185. https://doi.org/10.3390/su9020185.
Ridker, R. G., and J. A. Henning. 1967. “The determinants of residential property values with special reference to air pollution.” Rev. Econ. Stat. 49: 246–257. https://doi.org/10.2307/1928231.
Rosen, S. 1974. “Hedonic prices and implicit markets: Product differentiation in pure competition.” J. Political Econ. 82 (1): 34–55. https://doi.org/10.1086/260169.
Selim, S. 2008. “Determinants of house prices in Turkey: A hedonic regression model.” Dogus Univ. J. 9 (1): 65–76. https://doi.org/10.31671/dogus.2019.223.
Seo, W., and H. K. Nam. 2019. “Trade-off relationship between public transportation accessibility and household economy: Analysis of subway access values by housing size.” Cities 87: 247–258. https://doi.org/10.1016/j.cities.2018.11.004.
Shin, K., S. Washington, and K. Choi. 2007. “Effects of transportation accessibility on residential property values: Application of spatial hedonic price model in Seoul, South Korea, metropolitan area.” Transp. Res. Rec. 1994 (1): 66–73. https://doi.org/10.3141/1994-09.
Sirmans, S., D. Macpherson, and E. Zietz. 2005. “The composition of hedonic pricing models.” J. Real Estate Lit. 13 (1): 1–44.
So, H. M., R. Y. C. Tse, and S. Ganesan. 1997. “Estimating the influence of transport on house prices: Evidence from Hong Kong.” J. Prop. Valuation Investment 15 (1): 40–47. https://doi.org/10.1108/14635789710163793.
Sun, G., X. Han, S. Sun, and N. Oreskovic. 2018. “Living in school catchment neighborhoods: Perceived built environments and active commuting behaviors of children in China.” J. Transp. Health 8: 251–261. https://doi.org/10.1016/j.jth.2017.12.009.
Tian, G., Y. D. Wei, and H. Li. 2017. “Effects of accessibility and environmental health risk on housing prices: A case of Salt Lake County, Utah.” Appl. Geogr. 89: 12–21. https://doi.org/10.1016/j.apgeog.2017.09.010.
Tse, C. Y., and A. W. H. Chan. 2003. “Estimating the commuting cost and commuting time property price gradients.” Reg. Sci. Urban Econ. 33 (6): 745–767. https://doi.org/10.1016/S0166-0462(03)00011-5.
Wabe, J. S. 1971. “A study of house prices as a means of establishing the value of journey time, the rate of time preference and the valuation of some aspects of environment in the London metropolitan region.” Appl. Econ. 3 (4): 247–255. https://doi.org/10.1080/00036847100000012.
Wilkinson, R. K., and C. A. Archer. 1973. “Measuring the determinants of relative house prices.” Environ. Plann. A Econ. Space 5 (3): 357–367. https://doi.org/10.1068/a050357.
Williams, A. W. 1991. “A guide to valuing transport externalities by hedonic means.” Transp. Rev. 11 (4): 311–324. https://doi.org/10.1080/01441649108716793.
Wu, N., and S. Zhao. 2015. “Impact of transportation convenience, housing affordability, location, and schooling in residence choice decisions.” J. Urban Plann. Dev. 141 (4): 05014028. https://doi.org/10.1061/(ASCE)UP.1943-5444.0000258.
Yang, J., Y. Bao, Y. Zhang, X. Li, and Q. Ge. 2018. “Impact of accessibility on housing prices in dalian city of china based on a geographically weighted regression model.” Chin. Geogr. Sci. 28 (3): 505–515. https://doi.org/10.1007/s11769-018-0954-6.
Yang, L., J. Zhou, and O. F. Shyr. 2019. “Does bus accessibility affect property prices?” Cities 84: 56–65. https://doi.org/10.1016/j.cities.2018.07.005.
Information & Authors
Information
Published In
Copyright
© 2021 American Society of Civil Engineers.
History
Received: May 15, 2020
Accepted: Dec 23, 2020
Published online: Mar 18, 2021
Published in print: Jun 1, 2021
Discussion open until: Aug 18, 2021
Authors
Metrics & Citations
Metrics
Citations
Download citation
If you have the appropriate software installed, you can download article citation data to the citation manager of your choice. Simply select your manager software from the list below and click Download.
Cited by
- Yuan Li, Jamal Khan, Qaiser Jamal Mahsud, Urban housing prices, female labor participation, and economic development in china: A theoretical and empirical analysis, Frontiers in Psychology, 10.3389/fpsyg.2022.970039, 13, (2023).
- Sean Pascoe, Lukas Danner, Thejani Gunaratne, Tiana Pang, Peggy Schrobback, Tim Perrin, Polly Hilder, Estimating prices for “new” aquaculture species: A hedonic pricing approach, Aquaculture Economics & Management, 10.1080/13657305.2023.2186533, (1-23), (2023).
- Fatemeh Mostofi, Vedat Toğan, Hasan Basri Başağa, Ahmet Çıtıpıtıoğlu, Onur Behzat Tokdemir, Multiedge Graph Convolutional Network for House Price Prediction, Journal of Construction Engineering and Management, 10.1061/JCEMD4.COENG-13559, 149, 11, (2023).
- Yongwoon Cha, Taeil Park, Zhengxun Jin, Wonyoung Park, Determining the Construction Costs for Basic Type to Estimate the Sale Prices of New Multi-Family Housing Projects, Buildings, 10.3390/buildings12101691, 12, 10, (1691), (2022).
- Fatemeh Mostofi, Vedat Toğan, Hasan Basri Başağa, Real-estate price prediction with deep neural network and principal component analysis, Organization, Technology and Management in Construction: an International Journal, 10.2478/otmcj-2022-0016, 14, 1, (2741-2759), (2022).
- Endalkachew Kabtamu Mekonen, Drivers of rising residential house rent in Wolkite town, Gurage zone, Ethiopia, Cogent Social Sciences, 10.1080/23311886.2022.2087328, 8, 1, (2022).
- Hao Liu, Lin Xu, Lin Ma, Governmental Interactive Strategies for Urban Real Estate Investment in China: An Analysis of the Promotion Tournament Model, Journal of Urban Planning and Development, 10.1061/(ASCE)UP.1943-5444.0000874, 148, 4, (2022).
- Wanli Yang, The Determinants of Housing Prices: Evidence from Chinese Cities, SHS Web of Conferences, 10.1051/shsconf/202215101003, 151, (01003), (2022).
- Kankawee Chanasit, Ekapol Chuangsuwanich, Atiwong Suchato, Proadpran Punyabukkana, A Real Estate Valuation Model Using Boosted Feature Selection, IEEE Access, 10.1109/ACCESS.2021.3089198, 9, (86938-86953), (2021).