The effect of vegetation near real-estate properties

on perceived and actual property value comparing

different construction levels

Abstract

In a 2016 study conducted by Hareli et al., it was found that the presence of palm trees near a real estate property increases its perceived value. However, this finding was limited to hypothetical judgments. It is unclear if and to what extent this effect also applies to the actual value of real houses and whether it varies across different types of houses. across different types of houses. This study aims to fill these gaps by examining how palm trees, along with additional information about the residential environment, influence perception and evaluation of house value. Three experiments were conducted with participants from the USA and Europe, and the results were compared to those of the 2016 study.

The current experiments did not find any preference or advantage in perceived value for houses with palm trees, contrary to the previous study. One possible explanation for these contradictory findings is the Covid-19 epidemic that occurred between 2020 and 2022. During the epidemic, people's residential preferences changed due to factors such as economic uncertainty and fear of the disease. 

During the Covid-19 period, the experiments did not show a preference for palm trees. However, real data on apartment sales demonstrated a preference for houses with palm trees. The pandemic may have influenced people's preferences due to an association of palm trees with potential disease risks. This could explain why the previous study's finding was not replicated in the present experiments.

The presence of palm trees affected actual house prices, unlike in the experiments. This may be because many of the houses were evaluated before the pandemic, so changes in preferences due to it did not have an effect yet. These findings suggest that the preference for houses with palm trees is not as simple as initially thought. The Covid-19 epidemic and its association with palm trees may have influenced people's preferences in laboratory experiments, but real transaction data showed a different pattern. Further research is needed to understand the complex relationship between environmental factors, human perceptions, and real

estate valuations.