Study On Determinants Of Prices Of Prices Of Residential Land Parcels Using Hedonic Price Model

In recent years, with the deepening of land use system reform for state-owned land, urban land market in China has developed gradually and become an essential component of socialist market economy system. Land price is a key index which can reflect the scarity of land resource and the condition of supply and demand, and plays a significant role in the allocation of land resource. As a result, it has become a hot topic for the academician and theorists to research on. In addition, since residential land price is closely related to housing price, it has draw widespread attention. The research on the factors influencing residential land price and how they exert impacts can provide a basis for the scientific formulation of land supply policy and rational layout of urban infrastructure, raise the level of government's management of land price, and provide the developers with useful information for their investment decision-making.Hedonic Price approach is widely used in the area of real estate prices. It is an important method to study on the micro-determinants of property prices and to make the real estate price index. However, it hasn't been frequentyly used for the research on determinants of prices of residential land parcels in our nation.This paper chooses Nanjing——where the marketization degree of land transfer is comparatively high——as the research area. On the basis of systematical summarization of the dynamics of prices of residential land, a hedonic price model for urban residential land parcels was developed using a sample of residential land parcels located in main town area in Nanjing whose land-use rights was granted between 2003 and 2009, the factors influencing residential land price and how they exert impacts is discussed. The result shows that:(1) Parcel factors including lot size, floor area ratio, building density and landscaping ratio, locational factors including the accessibility of CBD and public traffic condition, neighborhood factors including the accessibility of hospitals that rated Grade A, Class 3 and the accessibility of provincial experimentation primary school singnificantly influence the prices of residential land parcels in Nanjing.Price in terms of per unit area and price in terms of per unit floor increase with the growth of landscaping ratio, the improvement of accessibility of CBD, accessibility of hospitals that rated Grade A, Class 3, accessibility of provincial experimentation primary school and public traffic condition, decrease with increase of lot size and building density. Price in terms of per unit area increases with the growth of floor area ratio, price in terms of per unit floor descends with the growth of floor area ratio.(2) Price of homogeneous residential land parcels in Nanjing in the year 2006,2007, 2008 and 2009 were 56.5%,19.4%,100.7% and 137.9% higher than that in 2003 respectively. Thus the chain growth rate of price of homogeneous residential land parcels between 2007 and 2009 were 40.2%,-8.6%,18.5% respectively.(3) During the development of hedonic price model, it is found that the coefficient of variable symbolizing accessibility of senior middle school is not statistically significant, and doesn't have a reasonable economic implication, while the coefficients of variables symbolizing accessibility of provincial experimentation primary school and accessibility of hospitals that rated Grade A, Class 3 are statistically significant and have a reasonable economic implication. As a result, it can be suggested that during the selection and quantification of neighborhood variables symbolizing the condition of communal facilitates besides the land parcels, attention should be paid not only to accessibility of the communal facilitates, but also quality of the communal facilitates.