Market value of the view restriction

Abstract

Based on the international literature, the effect of an existing panoramic view on the market value of properties is positive and significant. This value-adding factor varies by location and by type of view. In Central Europe, no such evaluation study has been elaborated until now. New building construction may restrict the existing panorama, and this is the other side of the same phenomenon. View restriction may result in stigmatization, which is a negative effect on the property. There are two major methodologies to observe the effect: revealed preference method (RPM) and stated preference method (SPM). One SPM approach is contingent valuation (CV), wherein well-informed stakeholders give their opinion about the impact caused by the investigated effect. The CV methodology, using the Delphi approach, was employed to observe the market value decrease in the cases of several restricted panorama situations in Budapest. Based on the research, this effect in Budapest is in line with the published western results. The result of the study can be used to support real estate developers and architects in their development decisions. This is an extended version of the article titled “The impact of view-restriction: a Delphi case study from Budapest”, presented at Creative Construction Conference 2018, CCC 2017, 30 June to 3 July 2018, Ljubljana, Slovenia.

Keywords

• market value
• panorama
• view restriction
• stigmatized property
• delphi method