The Role of Dual Pane Windows and Improvement Age in Explaining Residential Property Values

Journal of Sustainable Real Estate, Forthcoming

30 Pages Posted: 12 Oct 2011

See all articles by Ramya R. Aroul

Ramya R. Aroul

University of Texas at Arlington - Department of Finance and Real Estate

J. Andrew Hansz

E.V. Williams Center for Real Estate

Date Written: September 26, 2011

Abstract

Real estate literature concerned with energy efficient or green property features focuses primarily on the impact of green labeling, certifications and designations. There is a modest amount of research on the valuation impact of individual green features such as dual pane windows, an important and widely implemented green feature in the American housing stock. From a sample of single-family residential sale transactions, we develop and test a valuation theory for dual pane windows and our results from a hedonic pricing model indicate a positive and statistically significant direct effect for residential transactions with improvements possessing the dual pane window feature. However, when a dual pane window-age variable is introduced, the direct effect disappears and is replaced by this interaction effect.The supply of properties with dual pane windows decreases with property age and the significance of this interaction effect suggests that the valuation impact of the dual pane window feature increases with property age.

Keywords: Dual pane windows, Energy efficiency, Residential transaction prices, Improvement age, Real estate valuation, Hedonic method

Suggested Citation

Aroul, Ramya R. and Hansz, J. Andrew, The Role of Dual Pane Windows and Improvement Age in Explaining Residential Property Values (September 26, 2011). Journal of Sustainable Real Estate, Forthcoming, Available at SSRN: https://ssrn.com/abstract=1942980

Ramya R. Aroul (Contact Author)

University of Texas at Arlington - Department of Finance and Real Estate ( email )

Box 19449 UTA
Arlington, TX 76019
United States

HOME PAGE: http://omega.uta.edu/~rxa0885/

J. Andrew Hansz

E.V. Williams Center for Real Estate ( email )

Norfolk, VA 23529-0222
United States
7576833505 (Phone)

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