This paper explains the hedonic price methodology used to estimate the value of green and blue space implicit in property prices in urban areas in Great Britain. Several datasets were used to conduct the hedonic analysis: the ACORN dataset, which provides segmentation of UK neighbourhoods; the Zoopla dataset that includes information on over a million properties sold in Great Britain between 2009 and 2016; and the Ordnance Survey, which provides a wide range of variables derived through the geospatial analysis of multiple datasets. A hedonic price model was used to predict house prices based on structural and environmental variables.
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Based on the model, the predicted average property prices were GBP 246,010. The predicted average property price in the absence of green and blue spaces was GBP 241,197. This indicates that in the absence of green and blue spaces, property prices in Great Britain would be GBP 4,813 lower. This reflects the value of services provided by green and blue spaces. By multiplying this figure by the number of residential properties (27.2 million), the stock value of blue and green spaces in the UK was estimated to be GBP 130.9 billion.
Anderson, H. (Office of National Statistics) ‘Value of Nature Implicit in Property Prices – Hedonic Pricing Method (HPM) Methodology Note’.
Find this article at: https://www.ons.gov.uk/economy/environmentalaccounts/methodologies/valueofnatureimplicitinpropertypriceshedonicpricingmethodhpmmethodologynote
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