The Effects of Multiple Green Factors on Condominium Prices

Jiro Yoshida and Ayako Sugiura

The Journal of Real Estate Finance and Economics, 2015, vol. 50, issue 3, 412-437

Abstract: This paper analyzes the transaction prices of green buildings assessed on the basis of multiple green factors. Our theoretical model demonstrates that the initial green premium can be negative but becomes positive as the building ages if a green building has a higher life-cycle cost and a longer economic life. Our empirical analysis of green condominiums in Tokyo confirms this prediction. We additionally find that the longer-life design is associated with a price premium, but the use of renewable energy and recycled materials and water is associated with price discounts. The price discounts are interpreted as the capitalization of a greater life-cycle user cost. Copyright Springer Science+Business Media New York 2015

Keywords: Sustainability; Green buildings; Hedonic pricing; Property price; Residential real estate; Japan; Q51; R21; R31 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (29)

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Persistent link: https://EconPapers.repec.org/RePEc:kap:jrefec:v:50:y:2015:i:3:p:412-437

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DOI: 10.1007/s11146-014-9462-3

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