Willingness to Pay for Green Apartments in Surabaya, Indonesia

Abstract

The lack of green building and the public’s awareness of the environment is an issue in marketing green apartments in Surabaya, Indonesia. Limited knowledge on green buildings contributes to individuals avoiding risks of purchasing or investing in green apartments. Hence, this study aims to test the effects of green attributes, indoor air quality, accessibility, land attributes, and environmental awareness toward willingness to pay (WTP) for green apartments in Surabaya. This study gathers primary data through the distribution of questionnaires to 390 respondents on green apartments in Surabaya. The data analysis technique used is PLS-SEM. The results showed that green attributes, indoor air quality, land attributes, and environmental awareness significantly influences WTP. Seventy-nine percent of the respondents are willing to pay to own a green apartment for 15% more of the total purchase price, or $670–$6,700. In line with the finding, governments, educational institutions, and property-sector stakeholders need to work together to develop net zero buildings as well as raising green building literacy in the general public to get them to care more for the environment. In a tropical and developing country, the development of green apartments should be adjusted to provide positive benefits to the environment and other sustainable developments.