In a residential choice, the interests in Green Space Service related to comfort in the residence, views, and, of course, health are increasing. Urban green spaces are evaluated as a residential environment where residents can enjoy the leisure, recreation, and aesthetic comfort, which represents an externality that house prices are differentiated depending on accessibility.
The residential environment is not only influenced by a natural environment such as mountains, rivers, or urban green spaces, but also by urban facilities services created at the level of urban planning such as parks or green areas. Urban green space is also required to maintain and manage the natural environment intact, but the composition should be managed as a service provided to citizens by the land-use planning. To do so, an understanding of the benefits that urban green spaces give to humans is needed. With this, the basis for the conservation and management of urban green areas can be provided to policy makers.
However, previous studies, which analyze the association between housing prices and urban greenery, could not presume the economic value of the greenery but also cease to determine significance of the model or volatility per unit based on the area or street greenery by type. This is because the data that indicates the level of green space is not present. The development of methods for estimating the institutional standards and indicator to express the green level in quality is needed.
The purpose of this study was to demonstrate that the study of urban greenery level in hedonic house price model, which describes the exponential level of urban green spaces playing an important role in the formation house prices and explains the house prices, act as influencers in housing prices. Urban Green Space Index Calculation method through the research process, by providing a methodology for evaluating the greenery level and by demonstrating the role of urban green areas that affect housing prices, understand the value of nature conservation and made the basis of policy making for preservation, management, installation, and effects of the environment.
The purpose of this study was to calculate the index on the level of urban green spaces playing an important role in the formation house prices, based on their effectiveness, establish hedonic models, and estimate the economic value of the urban greenery by its type. Urban green space index derived through the research process provides a methodology for assessing urban greenery level and the economic value of urban green space help understand the value in preserving natural environment, which made the basis of policy draft related to perseverance, management, installation, and effects of the environment.
Research object region is Jeonju-si which embraces Moaksan Provincial Park as a big city with the size of metropolitan and has a great amount of urban green spaces through the Jeonjucheon, and its housing type is the apartment which accounts for 74.46%.
Research method is to select the type of urban green spaces by Delphi analysis, derive the importance by type to be used for weighting urban green space index in AHP technique, and then index urban greenery level.
Area Index reflects the weight to the each type of urban green spaces within the apartment complex and View Index is derived reflecting the weight to the available view limits by each greenery type based of the interior complex.
Key information shown in the process of estimating the role of greenery for urban house price formation is as follows.
First, the Delphi analysis of a target panel responsible for the trading business in the forefront of apartments trading market could select the type of urban green areas judged to be most affected in the apartment on the market. As the green area types planted or installed in the apartment complex wood/trees, streamlet, fountains, walkways, grass/flower beds and so on have been chosen and as the natural environment and facilities greenery surrounding the complex river/stream, the city park, mountain/forest, other small green area, promenade nearby, etc have been selected.
Second, the urban greenery importance by type affecting apartment prices were calculated by the AHP survey and analysis on the expert panel. The type with the highest importance as an apartment pricing factor of urban green spaces is analyzed to be wood/trees in the complex and river/stream around the complex. Urban greenery importance by type has been used as weights to calculate the Urban Green Space Index.
Third, the estimation of model was considered reasonable because the apartment complex character variables used in the model has the high explanation level and the similarity with the previous studies. Actual apartment transaction prices or the evaluation prices of government were shown low only when the number of elapsed years after building apartment was long, the apartment complex was with corridor access, or located in the highlands, which is the same with the results of previous studies. However unlike previous studies it is shown that the prices for the apartment complex close to government offices tend to form lower price, which seems to be because Jeonju city government offices are mainly located in the old town and the age of the apartments around the public offices is relatively high.
Fourth, urban green space index developed in this study is not only useful to estimate the apartment prices by the urban greenery level as showing a statistical significancy in the hedonic model to explain the price of the house, but also was demonstrated that it is acting as a formative factor of housing prices.
Fifth, while urban green space index is included as a statistically significant one in the double log model to analyze whether the relationship between the level of urban green spaces and the apartment prices is non-linear, the included index has shown the limited results depending on the model. Even though the economic value of urban green space could be partially estimated by the nonlinear model, it was determined that there are no problems even estimating the economic value with the linear model.
Sixth, after analyzing the market in accordance with whether there is a brand or not to determine whether the apartment market in Jeonju city is submarket or a market without existence of characteristic markets, it is found out that, depending on whether with brand or not, the market with different characteristics exists since significant variables, included in the model depending on whether the brand exists or not, is different from each other.
Seventh, however the model analyzing the actual transaction prices and the model analyzing the posted prices have the difference in the estimated value, generally both two types of the market prices had no problem at derivation from the models since there were not differences in the interpretation of the models.