Development of a model to estimate the benefit-cost ratio performance of housing

I. M. Johnstone

Construction Management and Economics, 2004, vol. 22, issue 6, 607-617

Abstract: A simulation model based on classical population dynamics is developed to estimate the benefit-cost ratio performance of different typologies of housing with the purpose of identifying potential reductions in the total costs and hence resources used to sustain housing. A typical New Zealand dwelling constructed of lightweight timber framing is used as an example. Dwellings within the simulation model undergo periodic cycles of refurbishment based on best practices. When the simulated housing stock expands at the rate of 1.5% per year, an annual expenditure equivalent to the costs to construct one dwelling sustains the services provided by 26.7 dwellings after adjustment for economic depreciation. This benefit-cost ratio performance improves by 32.4% when the housing stock is stationary. Further improvements of 5.3% can be achieved by deferring refurbishment and accepting a higher level of economic depreciation of dwelling services. The results of all scenarios indicate that structural systems with a service life of only 50 years should not be used unless the costs of such systems are substantially less than the costs of traditional structural systems and that lightweight timber framed dwellings should not be sustained well beyond a service life of 90 years.

Keywords: sustainability; housing stock; simulation model; benefit-cost ratio (search for similar items in EconPapers)
Date: 2004
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DOI: 10.1080/0144619042000202825

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