Development of an Innovative Land Valuation Model (iLVM) for Mass Appraisal Application in Sub-Urban Areas Using AHP: An Integration of Theoretical and Practical Approaches

Jannet C. Bencure, Nitin K. Tripathi, Hiroyuki Miyazaki, Sarawut Ninsawat and Sohee Minsun Kim
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Jannet C. Bencure: Remote Sensing and Geographic Information System, School of Engineering Technology, Asian Institute of Technology, 58 Moo 9, Klong Luang, Pathumthani 12120, Thailand
Nitin K. Tripathi: Remote Sensing and Geographic Information System, School of Engineering Technology, Asian Institute of Technology, 58 Moo 9, Klong Luang, Pathumthani 12120, Thailand
Hiroyuki Miyazaki: Remote Sensing and Geographic Information System, School of Engineering Technology, Asian Institute of Technology, 58 Moo 9, Klong Luang, Pathumthani 12120, Thailand
Sarawut Ninsawat: Remote Sensing and Geographic Information System, School of Engineering Technology, Asian Institute of Technology, 58 Moo 9, Klong Luang, Pathumthani 12120, Thailand
Sohee Minsun Kim: Department of Development and Sustainability, School of Environment, Resources and Development, Asian Institute of Technology, 58 Moo 9, Klong Luang, Pathumthani 12120, Thailand

Sustainability, 2019, vol. 11, issue 13, 1-17

Abstract: Land development in sub-urban areas is more frequent than in highly urbanized cities, causing land prices to increase abruptly and making it harder for valuers to update land values in timely manner. Apart from this, the non-availability of sufficient reliable market values forces valuers to use alternatives and subjective judgement. Land value is critical not only for private individuals but also for government agencies in their day-to-day land dealings. Thus, mass appraisal is necessary. In other words, despite the importance of reliable land value in all aspects of land administration, valuation remains disorganized, with unregulated undertakings that lack concrete scientific, legal, and practical foundations. A holistic and objective way of weighing geospatial factors through expert consultation, legal reviews, and evidence (i.e., news) will provide more realistic results than a regression-based method that does not comprehend valuation factors (i.e., physical, social, economic, environmental, and legal aspects). The analytic hierarchy process (AHP) enables these factors to be included in the model, hence providing a realistic result. The innovative land valuation model (iLVM), developed in this study, is an inclusive approach wherein experts are involved in the selection and weighing of 15 factors through the AHP. The model was validated using root mean squared error (RMSE) and compared with multiple regression analysis (MRA) through a case study in Baybay City, Philippines. Based on the results, the iLVM (RMSE = 0.526) outperformed MRA (RMSE = 1.953).

Keywords: land valuation; mass appraisal; real estate; analytic hierarchy process (AHP); multiple regression analysis (MRA); geographic information system (GIS) (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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