The Nascent Market for “Green” Real Estate in Beijing
Date: 2011
Authors: Siqi Zheng, Jing Wu, Matthew E. Kahn, Yongheng Deng
This paper discusses an information problem existent in the Chinese real estate market. The authors attempt to evaluate how consumers react to a residential constructions ‘greenness’ at the pre-sale stage as well as at the resell/rent stage. They have detailed their methodology that employs generating a Google-search based index through which they correlate the prices to how ‘green’ the buildings have been marketed to be. They conclude that at the pre-sale stage greenness is associated with a price premium, which is sustained if the building is in fact green and energy efficient. If however it is discovered that the opposite is the case, then the pre-sale prices are discounted. The authors offer a possible solution to this issue as being the certification of green projects to ensure that developers would actually deliver on the energy efficiency and cost savings they promise.
Snapshot:
1 Comment
Leave a Reply
-
Advertisement
-
Advertisement
Emelie Abing
17/01/2014 at 11:47 am
Green condominiums are now also introduced in Philippines, we have a group of people monitoring this kind of building, and yes it comes with a premium price. Green tech is new to people’s ear and thus bring a lot of big buzz on the real estate market, but buyers should really be extra careful and read a lot about green revolution so as they know if they are getting good offers from developers.