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  • Thumbnail for Do apartment and house buyers have different preferences on amenity accessibilities? : A spatial hedonic approach on the determinants of housing values
    Do apartment and house buyers have different preferences on amenity accessibilities? : A spatial hedonic approach on the determinants of housing values by Cheng, Ka Yi Kate

    Prior studies that estimate the impact of amenity accessibility on residential property prices have largely treated housing as a homogenous commodity. Yet there is strong evidence that differentiation in metropolitan housing sub-markets matter (Goodman and Thibodeau, 1998; Hoesli and Peng, 2002). Using an hedonic pricing approach and controlling for spatial effects, this paper examines the preferences of house and apartment buyers regarding amenity accessibility in Brooklyn, NY, for the period 2008 to 2013. We find that the preferences for amenities between the two types of home-buyers are indeed different. More specifically, our findings show that the marginal implicit value, as evidenced through home sales prices, of accessibility to cultural amenities (e.g. proximity to monuments, beaches, parks and cafes) is greater for apartment than house buyers. On the other hand, the marginal implicit value of workplace amenity accessibility (e.g. proximity to central business district and subway stations) is greater for house than apartment buyers. The result illustrates the importance of differentiating housing sub-markets when estimating these impacts. Urban policy makers and real estate developers can also use the result to inform land use planning in metropolitan areas aimed at further increasing residential property values.