The Value of an Apartment with Sunlight and a View: A Quasi-Experimental Analysis

Hyunki Hong, Hoyong Jung and Duol Kim
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Hyunki Hong: Eugene Asset Management
Hoyong Jung: Kookmin University
Duol Kim: Myongji University

Korean Economic Review, 2024, vol. 40, 177-194

Abstract: The Vert-Vill apartments consist of two 32-story buildings of similar structure: Vert-Vill 101 and 102. The tenants enjoyed a beautiful view and sunlight without interruption. However, the construction of The Lucky Golden Suite three meters from Vert-Vill 101 removed Vert-Vill 101’s sunlight and view entirely without impacting Vert-Vill 102. We performed a difference-in-difference analysis using this experimental circumstance and found that access to sunlight and a view account for 18.0% of apartment prices. Our findings suggest that conventional hedonic analysis, which contains the risk of omitted variable bias, may generate biased estimates.

Keywords: House Price; Sunlight; View; Amenity; Difference-in-differences; Hedonic Pricing (search for similar items in EconPapers)
JEL-codes: K1 K2 R3 (search for similar items in EconPapers)
Date: 2024
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