A Comparative Study on the Value of Scenic Views in an Inland City and a Coastal City in Korea

This study estimates through spatial regression hedonic house price models for an inland city in Seoul and a coastal city in Pusan using successful bidding price data of court auction during the period from January 2006 to December 2014. Among such hedonic attributes as size, building age, total floor level, living floor level, direction of living room, scenic views, among others employed in this study, our main focus was on scenic views. The most preferred view turns out to be water-related views such as a river view (Seoul) or ocean view (Pusan). Mountain views, while affecting negatively in a coastal city, Pusan, which is adjacent to the beautiful ocean, have positive influence in Seoul since it is an inland city with no ocean in sight and with only a river running across the heart of the city encircled with mountains serving as its boundary. The result also shows that spatial error model provides an improved fit compared to a conventional OLS and spatial lag model.