Farmland value in the “Conegliano Valdobbiadene Prosecco Superiore PGDO” area. An application of the Hedonic Pricing method.

Abstract

In the last 30 years, numerous studies analysed the factors that affect land prices mainly using the Hedonic Pricing method. These studies have shown that many factors can affect land prices (e.g. land and surrounding territory characteristics, accessibility, proximity to urban area, etc.). However, they rarely addressed the analysis of the reliability of the models by comparing the estimated values to the observed one. Attempting to face this problem, our study analysed the land market of the “Conegliano Valdobbiadene Prosecco Superiore PGDO” area. Despite the quite high coefficient of determination (r2 = 0.76) and statistical significance of the model parameters, we found that the percentage absolute deviation between observed and estimated value is higher than 30% in 34% of cases. Our results seem to suggest that future researches should devote particular attention to the analysis of the discrepancies existing between estimated values and market prices in order to support the appraisal activity of professional valuers.