Shared amenities' impacts on condominium resale values. Issue 2 (29th July 2019)

• Record Type: Journal Article
• Authors: Tajima, Kayo
• Is Part Of: International journal of housing markets and analysis. Volume 13:Issue 2(2020)
• Page Start: 281
• Page End: 297
• Publication Date: 2019-07-29
• Subjects: Social interaction -- Housing prices -- Tokyo -- Resale prices -- Community spaces -- Condominium; Residential real estate -- Periodicals; 333.3382205
• DOI: 10.1108/IJHMA-03-2019-0038
• Languages: English
• ISSNs: 1753-8270

Abstract

Abstract : Purpose: This study aims to analyze whether and how condominium shared utilities and facilities (e.g. community spaces), of which buyers assume a share of the ownership upon acquisition of a residential unit, affect the condominium unit price over time. Design/methodology/approach: The transaction price of each unit reflects the quality of the residential unit and the properties of the shared facilities. Based on the hedonic pricing method, this study assesses the impact of shared amenities on unit resale prices, using an original data set on condominium unit resale transactions and the status of housing characteristics for both condominium units and condominium buildings. Findings: Results show that holding other conditions constant, a meeting room and an external space that can host events increase the unit resale price by approximately 7 and 16 per cent, respectively. Some community amenities such as a meeting room may increase its impact later in the condominium's lifetime. Research limitations/implications: Because of the proprietary nature of data, the analysis focuses on high-end condominium properties in central Tokyo. Although it is difficult to single out the shared amenities' effects on condominium resale prices from potentially confounding factors, this study partially overcomes this issue by including explanatory geographical variables (e.g. ground heights). Practical implications: The results suggest that a shared facility that hosts social interactions among residents significantly affects the resale market value of housing units and that their magnitudes may change over time. Originality/value: To the best of the author's knowledge, this study provides the first empirical evidence of the impacts of shared structures on condominium unit sales using micro-level transaction data in Japan.