AIR QUALITY AND PROPERTY PRICES IN HIGH DENSITY URBAN AREAS

This study examines the relationship between air quality and property prices at a microscopic level to eliminate district level noise. A densely populated area dominated by high-rise developments was chosen for a case study. The street level air quality of the chosen area was estimated by computational fluid dynamics software using a three-dimensional Reynolds stress turbulence model. Property transaction prices in the same areas were then collected to construct a hedonic price model, which includes simulated air quality as an explanatory variable. Our findings indicated that air quality was reflected in property prices. This suggested that the property market was more efficient than any studies have implied so far, since there was no publicly available information on street level air quality. Further research and field measurements may be conducted to validate the findings.