The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings

Shoshi Ofek; Andrea Ghermandi; Boris Portnov

doi:doi:10.11648/j.ajce.20221002.14

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The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings

Shoshi Ofek, Andrea Ghermandi, Boris Portnov

Published in American Journal of Civil Engineering (Volume 10, Issue 2)

Received: 13 February 2022 Accepted: 7 March 2022 Published: 20 April 2022

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Abstract

Green buildings help to mitigate the impacts of construction on the environment by reducing the use of natural resources and limiting the emission of air pollutants associated with building construction and maintenance. Homebuyers who understand the life-cycle benefits of green buildings (such as lower operating costs, better indoor environment and reduced environmental impacts) are often willing to pay an additional price premium for such buildings. Although several studies examined the factors affecting the acceptable size of green building price premium, how the expected time to home purchase might affect the acceptable size of such premium remains unexplored. Here, we attempt to answer this question by using data from a countrywide survey carried out in Israel, in which responses from 390 potential homebuyers were collected and analyzed. We find that the willingness to pay a price premium for green buildings changes significantly with time to purchase and is the lowest for respondents who state that they do not plan to buy a home anytime in the near future. We explain this rather unexpected result by arguing that people who have no immediate home buying intention, might have only limited knowledge about contemporary housing market trends and thus do not consider green building as a viable alternative to traditional construction.

Published in	American Journal of Civil Engineering (Volume 10, Issue 2)
DOI	10.11648/j.ajce.20221002.14
Page(s)	55-63
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Green Buildings, Price Premium, Time-to-Purchase, Israel, Survey

References

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APA Style

Shoshi Ofek, Andrea Ghermandi, Boris Portnov. (2022). The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings. American Journal of Civil Engineering, 10(2), 55-63. https://doi.org/10.11648/j.ajce.20221002.14

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ACS Style

Shoshi Ofek; Andrea Ghermandi; Boris Portnov. The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings. Am. J. Civ. Eng. 2022, 10(2), 55-63. doi: 10.11648/j.ajce.20221002.14

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AMA Style

Shoshi Ofek, Andrea Ghermandi, Boris Portnov. The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings. Am J Civ Eng. 2022;10(2):55-63. doi: 10.11648/j.ajce.20221002.14

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@article{10.11648/j.ajce.20221002.14,
  author = {Shoshi Ofek and Andrea Ghermandi and Boris Portnov},
  title = {The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings},
  journal = {American Journal of Civil Engineering},
  volume = {10},
  number = {2},
  pages = {55-63},
  doi = {10.11648/j.ajce.20221002.14},
  url = {https://doi.org/10.11648/j.ajce.20221002.14},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajce.20221002.14},
  abstract = {Green buildings help to mitigate the impacts of construction on the environment by reducing the use of natural resources and limiting the emission of air pollutants associated with building construction and maintenance. Homebuyers who understand the life-cycle benefits of green buildings (such as lower operating costs, better indoor environment and reduced environmental impacts) are often willing to pay an additional price premium for such buildings. Although several studies examined the factors affecting the acceptable size of green building price premium, how the expected time to home purchase might affect the acceptable size of such premium remains unexplored. Here, we attempt to answer this question by using data from a countrywide survey carried out in Israel, in which responses from 390 potential homebuyers were collected and analyzed. We find that the willingness to pay a price premium for green buildings changes significantly with time to purchase and is the lowest for respondents who state that they do not plan to buy a home anytime in the near future. We explain this rather unexpected result by arguing that people who have no immediate home buying intention, might have only limited knowledge about contemporary housing market trends and thus do not consider green building as a viable alternative to traditional construction.},
 year = {2022}
}

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TY  - JOUR
T1  - The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings
AU  - Shoshi Ofek
AU  - Andrea Ghermandi
AU  - Boris Portnov
Y1  - 2022/04/20
PY  - 2022
N1  - https://doi.org/10.11648/j.ajce.20221002.14
DO  - 10.11648/j.ajce.20221002.14
T2  - American Journal of Civil Engineering
JF  - American Journal of Civil Engineering
JO  - American Journal of Civil Engineering
SP  - 55
EP  - 63
PB  - Science Publishing Group
SN  - 2330-8737
UR  - https://doi.org/10.11648/j.ajce.20221002.14
AB  - Green buildings help to mitigate the impacts of construction on the environment by reducing the use of natural resources and limiting the emission of air pollutants associated with building construction and maintenance. Homebuyers who understand the life-cycle benefits of green buildings (such as lower operating costs, better indoor environment and reduced environmental impacts) are often willing to pay an additional price premium for such buildings. Although several studies examined the factors affecting the acceptable size of green building price premium, how the expected time to home purchase might affect the acceptable size of such premium remains unexplored. Here, we attempt to answer this question by using data from a countrywide survey carried out in Israel, in which responses from 390 potential homebuyers were collected and analyzed. We find that the willingness to pay a price premium for green buildings changes significantly with time to purchase and is the lowest for respondents who state that they do not plan to buy a home anytime in the near future. We explain this rather unexpected result by arguing that people who have no immediate home buying intention, might have only limited knowledge about contemporary housing market trends and thus do not consider green building as a viable alternative to traditional construction.
VL  - 10
IS  - 2
ER  -

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Author Information

Shoshi Ofek

The Herta and Paul Amir Faculty of Social Sciences, Department of Natural Resources and Environmental Management, University of Haifa, Haifa, Israel
Andrea Ghermandi

The Herta and Paul Amir Faculty of Social Sciences, Department of Natural Resources and Environmental Management, University of Haifa, Haifa, Israel
Boris Portnov

The Herta and Paul Amir Faculty of Social Sciences, Department of Natural Resources and Environmental Management, University of Haifa, Haifa, Israel

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Plain Text BibTeX RIS

APA Style

Shoshi Ofek, Andrea Ghermandi, Boris Portnov. (2022). The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings. American Journal of Civil Engineering, 10(2), 55-63. https://doi.org/10.11648/j.ajce.20221002.14

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ACS Style

Shoshi Ofek; Andrea Ghermandi; Boris Portnov. The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings. Am. J. Civ. Eng. 2022, 10(2), 55-63. doi: 10.11648/j.ajce.20221002.14

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AMA Style

Shoshi Ofek, Andrea Ghermandi, Boris Portnov. The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings. Am J Civ Eng. 2022;10(2):55-63. doi: 10.11648/j.ajce.20221002.14

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@article{10.11648/j.ajce.20221002.14,
  author = {Shoshi Ofek and Andrea Ghermandi and Boris Portnov},
  title = {The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings},
  journal = {American Journal of Civil Engineering},
  volume = {10},
  number = {2},
  pages = {55-63},
  doi = {10.11648/j.ajce.20221002.14},
  url = {https://doi.org/10.11648/j.ajce.20221002.14},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajce.20221002.14},
  abstract = {Green buildings help to mitigate the impacts of construction on the environment by reducing the use of natural resources and limiting the emission of air pollutants associated with building construction and maintenance. Homebuyers who understand the life-cycle benefits of green buildings (such as lower operating costs, better indoor environment and reduced environmental impacts) are often willing to pay an additional price premium for such buildings. Although several studies examined the factors affecting the acceptable size of green building price premium, how the expected time to home purchase might affect the acceptable size of such premium remains unexplored. Here, we attempt to answer this question by using data from a countrywide survey carried out in Israel, in which responses from 390 potential homebuyers were collected and analyzed. We find that the willingness to pay a price premium for green buildings changes significantly with time to purchase and is the lowest for respondents who state that they do not plan to buy a home anytime in the near future. We explain this rather unexpected result by arguing that people who have no immediate home buying intention, might have only limited knowledge about contemporary housing market trends and thus do not consider green building as a viable alternative to traditional construction.},
 year = {2022}
}

Copy | Download

TY  - JOUR
T1  - The Effect of the Expected Time-to-Purchase on the Acceptable Price Premium for Green Buildings
AU  - Shoshi Ofek
AU  - Andrea Ghermandi
AU  - Boris Portnov
Y1  - 2022/04/20
PY  - 2022
N1  - https://doi.org/10.11648/j.ajce.20221002.14
DO  - 10.11648/j.ajce.20221002.14
T2  - American Journal of Civil Engineering
JF  - American Journal of Civil Engineering
JO  - American Journal of Civil Engineering
SP  - 55
EP  - 63
PB  - Science Publishing Group
SN  - 2330-8737
UR  - https://doi.org/10.11648/j.ajce.20221002.14
AB  - Green buildings help to mitigate the impacts of construction on the environment by reducing the use of natural resources and limiting the emission of air pollutants associated with building construction and maintenance. Homebuyers who understand the life-cycle benefits of green buildings (such as lower operating costs, better indoor environment and reduced environmental impacts) are often willing to pay an additional price premium for such buildings. Although several studies examined the factors affecting the acceptable size of green building price premium, how the expected time to home purchase might affect the acceptable size of such premium remains unexplored. Here, we attempt to answer this question by using data from a countrywide survey carried out in Israel, in which responses from 390 potential homebuyers were collected and analyzed. We find that the willingness to pay a price premium for green buildings changes significantly with time to purchase and is the lowest for respondents who state that they do not plan to buy a home anytime in the near future. We explain this rather unexpected result by arguing that people who have no immediate home buying intention, might have only limited knowledge about contemporary housing market trends and thus do not consider green building as a viable alternative to traditional construction.
VL  - 10
IS  - 2
ER  -

Copy | Download