The value of rural landscape in Aquitania (Colombia): application of spatial hedonic models in real estate analysis

Ana Milena Plata Fajardo,Julio Cañón,Raffaele Lafortezza

doi:10.11144/javeriana.cdr12-76.vrla

Abstract

This study addresses the marginal economic value of environmental amenities, structural characteristics, neighborhood facilities, and accessibility on property in Aquitania - Colombia. Based on 400 assessed values of rural land property and on 21 characteristic variables of land amenities and facilities, the study compares three models: Ordinary Least Squares (ols), Spatial Lag Model (slm), and Spatial Error Model (sem). Results show that both slm and sem outperformed ols in identifying the significance of real estate attributes. Results shows that farmers value environmental amenities more than other attributes, being implicit the greater value of cattle over agriculture (onion) in land use. These models may help to support decisions in rural real estate economics.

Highlights

IntroductionLand price analysis is an important element of real estate economics (involving land and buildings in residential, commercial, and agricultural sectors), which is used by governments and the private sector in rural planning, and policy evaluation and implementation (Ismail, 2010)
Land price analysis is an important element of real estate economics, which is used by governments and the private sector in rural planning, and policy evaluation and implementation (Ismail, 2010).While countries such as the United States, Switzerland, and Taiwan have been developing systems of rural real estate ownership to manage and guarantee property information and to identify the attributes of properties (Hoesli & MacGregor, 2000), in developing countries, by contrast, information concerning rural real estate is scarce and not available
The estimated results suggest that in regard to land use, onion represents the highest influence on rural parcel price, since land uses for onion increase the rural parcel price by 852.81/ha, other variables remaining constant

Summary

Introduction

Land price analysis is an important element of real estate economics (involving land and buildings in residential, commercial, and agricultural sectors), which is used by governments and the private sector in rural planning, and policy evaluation and implementation (Ismail, 2010). While countries such as the United States, Switzerland, and Taiwan have been developing systems of rural real estate ownership to manage and guarantee property information and to identify the attributes of properties (Hoesli & MacGregor, 2000), in developing countries, by contrast, information concerning rural real estate is scarce and not available. The non-existence of a separate market for externalities does not prevent them from being internalized or priced, since externalities can be traded jointly with other goods (Chau et al, 2004)

Methods

Results

Conclusion