The impact of tourism resources on tourism real estate value

Abstract

Leisure and tourism facilities are known to influence property value. Previous studies have found natural resources to have a positive impact on the price of surrounding properties. More recently, scholars have turned their attention to “built” tourism resources, such as resorts and sports facilities. “Tourism real estate” emerged in China in the 1990s. Contrary to traditional housing projects, tourism real estate is characterized by the development of large-scale tourism resources (e.g. resorts and theme parks) along with residential properties, under the assumption that they would increase property value. However, the effects of such “built” tourism resources on housing value have not been empirically examined. This study investigates the determinants of tourism real estate prices, with an emphasis on the impact of theme parks. A hedonic pricing model was built using a sample of 294 real estate transactions in the Overseas Chinese Town area of Shenzhen, China. Findings indicated that while distance to metro and the architectural features of the property itself had significant positive effects on tourism real estate value, distance to theme parks was found to have a negative effect on price. As the constructions of theme parks alongside residential/vacation properties represent a typical model of tourism real estate, findings urge the industry to reconsider the development of theme parks and its impact on the surrounding environment.