The influence of environmental aesthetics on economic value of housing: an empirical research on virtual environments

Previous studies on house prices tend to focus on parameters such as location, size and view. Such studies ignored the influence of environmental aesthetics on house prices. Considering the scientific evidence that showed a significant effect of environmental aesthetic on people's environmental preference and behaviour, this study aims to investigate the influence of environmental aesthetic on estimated house prices. Twelve computer-simulated residential environments were created. Computer-simulated images vary on three categories to manipulate complexity and coherence along a street: (1) building location (attached, detached and both), (2) building height (same and different) and (3) building setback (same and different). Forty-seven university students viewed the computer-simulated environments and answered questions to evaluate aesthetic and economic values of each street. For the aesthetic value, participants evaluated the extent to which the environment is arousing, pleasant, exciting, relaxing, complex, coherent and safe. For the economic value, participants estimated market price (for sale and for rent) of a specific apartment on a computer simulation of a residential street. Results showed that estimated sale price was influenced by excitement, coherence and pleasantness; estimated rental price was influenced by complexity, arousal, coherence and pleasantness. This study aimed to pave the way for such studies by introducing an inspiring methodology and highlighting the importance of environmental aesthetics on house prices. Moreover, the findings have applied value for planners, urban designers and real estate agents.