The purpose of this study is to investigate the major influential factors that determine the urban structure in terms of the time-series fluctuations of land values in a metropolitan city. For the purpose, the study takes Seoul city as a case using th...
The purpose of this study is to investigate the major influential factors that determine the urban structure in terms of the time-series fluctuations of land values in a metropolitan city. For the purpose, the study takes Seoul city as a case using the hedonic price function. The hedonic price function represents or extracts an implicit value of a certain property based on its interior value-characteristics.
The major findings of the study are as follows:
In terms of accessibility, the prices of commercial- and residential lands are both dependent on the physical distances to Kangnam (a sub-center). That is, the closer the location is to Kangnam, the higher the value is, though the value gaps are much larger among the commercial lands than among the residential lands.
In terms of characteristic, however, the regression coefficients for the number of college students show mixed results, i.e., it negatively affects the land values in certain cases. At the same time, a higher housing density makes a negative effect to the land values whereas more amenities and convenient traffic conditions raise the values higher than otherwise.
The amenity factors generally show negative effects as expected. The distance to the Han-River has been very influential to the prices of land since the Han-River Development Plan started in the early 1980's. Also, the sulfur dioxide concentration as an indicator of air pollution affects most to the land values, and it is the most important factor among all amenity variables to determine the land values. To the contrary, one of the significant factors that lower the land prices is the expanded open parks. Accessibility to the remaining big greenbelts like Namsan or Bukhansan Mountains within the Seouls boundary also has negative effects generally. As such, one might raise questions as to what the effectiveness of greenbelts within the city boundary would be as far as the land values are concerned.
Additionally, a dummy variable that splits all locations into either Kangnam area (River South) of Kangbuk area (River North) has been introduced to explicitly capture the land value premiums in Kangnam areas.