1# RECORD b150aa7a491222e57926fd7829879b82c8d7c8d62# TITLE: The Impacts of Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable Urban Development Align with SDG 113# YEAR: 2024.0 VENUE: Journal of Lifestyle and SDGs Review DOI: 10.47172/2965-730x.sdgsreview.v5.n02.pe028064# AUTHORS: Md Abdus Sobhan; Md. Elias Hossain; Rashed Ahmed; Md. Yahia Bapari5# PAGES: 22 CANDIDATE TABLE PAGES (1-based): [11, 12, 13, 14, 15]6# ABSTRACT: Objective: The objective of the study is to assess the impacts of environmental amenities on rental value of houses and formulate the pathway for sustainable urban development align with Sustainable Development Goals 11.7 8Theoretical Framework: The hedonic pricing model is an effective theoretical foundation for examining influence of environmental amenities and dis-amenities on house rental prices. It investigates how environmental factors influence house rental prices and promote sustainable urban development goals.9 10Method: The study is based on 210 primary data which are collected by random sampling survey of tenants living in Rajshahi City, Bangladesh. The hedonic regression method is used for assessing house rent determinants and willingness to pay formula is used for hedonic valuation of environmental attributes.11 12Results and Discussion: The study found four factors- income of tenant, house structure characteristics, neighborhood characteristics and environmental amenities including ventilation, open space proximity, drainage management, waterlogging and landfill by wastes which affect houses rent. In planned areas, proximity to open spaces and ventilation increases the rental value by 77.27% and 24.46% respectively than that of unplanned area. The willingness to pay for environmental amenities including open space, ventilation and proper drainage is BDT162.148 (US $1.35), BDT 164.055 (US $1.36, and BDT 64.271 (US $0.53) respectively from their average rent in planned area. In contrast, in unplanned areas, tenants are willing to pay more BDT 45.061 (US $0.37) for open space closer proximity, BDT 64.693 (US $0.53) for ventilation and BDT 78.536 (US $0.65) for proper drainage from their average rent.13 14Research Implications: The study propose that urban planning should prioritize environmental improvements, real estate developers should increase the value of houses through improved amenities and emphasizes the tenant preferences in developing sustainable residential zones.15 16Originality/Value: This study presents empirical evidence on the valuation of environmental amenities in Bangladeshi housing markets, adding new insights to the fields of urban economics and sustainability.171819===== PAGE 1 (score 9, numeric-paren 0, table-words 0, var-words 8) =====2021 22SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 231 24THE IMPACTS OF ENVIRONMENTAL AMENITIES ON RENTAL VALUE OF 25HOUSES AND A PATHWAY TOWARDS SUSTAINABLE URBAN 26DEVELOPMENT ALIGN WITH SDG 11 27 28Md. Abdus Sobhan1 29Md. Elias Hossain2 30Rashed Ahmed3 31Md. Yahia Bapari4 32 33ABSTRACT 34 35Objective: The objective of the study is to assess the impacts of environmental amenities on 36rental value of houses and formulate the pathway for sustainable urban development align with 37Sustainable Development Goals 11. 38 39Theoretical Framework: The hedonic pricing model is an effective theoretical foundation for 40examining influence of environmental amenities and dis-amenities on house rental prices. It 41investigates how environmental factors influence house rental prices and promote sustainable 42urban development goals. 43 44Method: The study is based on 210 primary data which are collected by random sampling survey 45of tenants living in Rajshahi City, Bangladesh. The hedonic regression method is used for 46assessing house rent determinants and willingness to pay formula is used for hedonic valuation 47of environmental attributes. 48 49Results and Discussion: The study found four factors- income of tenant, house structure 50characteristics, neighborhood characteristics and environmental amenities including 51ventilation, open space proximity, drainage management, waterlogging and landfill by wastes 52which affect houses rent. In planned areas, proximity to open spaces and ventilation increases 53the rental value by 77.27% and 24.46% respectively than that of unplanned area. The willingness 54to pay for environmental amenities including open space, ventilation and proper drainage is 55BDT162.148 (US $1.35), BDT 164.055 (US $1.36, and BDT 64.271 (US $0.53) respectively from 56their average rent in planned area. In contrast, in unplanned areas, tenants are willing to pay 57more BDT 45.061 (US $0.37) for open space closer proximity, BDT 64.693 (US $0.53) for 58ventilation and BDT 78.536 (US $0.65) for proper drainage from their average rent. 59 60Research Implications: The study propose that urban planning should prioritize environmental 61improvements, real estate developers should increase the value of houses through improved 62amenities and emphasizes the tenant preferences in developing sustainable residential zones. 63 64Originality/Value: This study presents empirical evidence on the valuation of environmental 65amenities in Bangladeshi housing markets, adding new insights to the fields of urban economics 66and sustainability. 67 68Keywords: Environmental Amenity, Hedonic Pricing, House Rent, Sustainable City, Bangladesh, 69Sustainable Development Goals (SDGs). 70 71 72 731 Department of Economics, Varendra university, Rajshahi-6205, Bangladesh. 74E-mail: sobhanshuvo2199@gmail.com 752 Department of Economics, University of Rajshahi, Rajshahi-6205, Bangladesh. 76E-mail: eliaseco@ru.ac.bd 773 Department of Economics, Comilla University, Comilla, Bangladesh. 78E-mail: rashed@cou.ac.bd 794 Department of Economics, Pabna University of Science and Technology, Pabna-6600, 80Bangladesh. E-mail: yahia.bapari@pust.ac.bd 818283===== PAGE 11 (score 20, numeric-paren 1, table-words 5, var-words 7) =====8485 86 87 88SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 8911 90Sobhan, M., A., Hossain, M., E., Ahmed, R., Bapari, M., Y. (2025) The Impacts of 91Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable 92Urban Development Align with SDG 11 93School distance 94Kilometer 951.53 960.96 972.15 98Open space dis. 99Meter 100138 10183 102144 103Ventilation 1041-5 scale 1053.19 1063.29 1072.81 108Waterlogging 1090=No 11057.14% 11179% 11266.36% 1131=Yes 11442.86% 11521% 11633.64% 117Landfill 1180=No 11959.52% 12091% 12180% 1221=Yes 12340.48% 1249% 12520% 126Drainage/Sewage 1271-5 scale 1283.22 1293.58 1302.61 131 132 133In planned residential areas, most of the neighborhood attributes are 134closer to access while in unplanned areas are opposite in this regard. For one 135of the most important sets of attributes is environmental attributes in the 136housing market. Table 2 reports that the average distance of open space 137proximity is around 138 meters in overall area and varying from 5 to 300 meter. 138The average ventilation and drainage system score in the overall area is around 1393.19 and 3.22 respectively. The average waterlogging and landfill presence in 140overall area is around 79 and 91 percent respectively. There is a quite 141difference regarding environmental attributes in planned and unplanned 142residential areas where comparatively higher ventilation scores, closer 143proximity to open spaces, improved drainage system, less severity of waterlog 144and landfill exist into unplanned residential areas. 145Rajshahi City is renowned for living in because of its natural beauty and 146cleanness. The reputation as a clean city, it has led to influx many people 147migrated from another city to this city. As a result, the city is rapidly becoming 148more urbanized, and the housing market is expanding, endangering the 149environment. This study is based on hedonic pricing method to find out the 150determinants of rental value of houses and valuation for environmental 151amenities. 152 1534.2 THE DETERMINANTS OF HOUSE RENT IN OVERALL RAJSHAHI CITY 154CORPORATION AREA 155 156Table 3 157Regression Result of the Hedonic Pricing Approach of Overall Area. 158Variables 159Coefficient 160Robust Std. Err. 161t-ratio 162P-Value 163Income 164.0000039*** 165.00000063 1666.14 1670.000 168Age of house 169-0.0050*** 1700.0020 171-2.99 1720.003 173174175===== PAGE 12 (score 33, numeric-paren 6, table-words 5, var-words 13) =====176177 178 179 180SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 18112 182Sobhan, M., A., Hossain, M., E., Ahmed, R., Bapari, M., Y. (2025) The Impacts of 183Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable 184Urban Development Align with SDG 11 185Room Number 1860.0102*** 1870.0032 1883.13 1890.002 190Garage 1910.0110 1920.0139 1930.80 1940.427 195Work place distance 196-0.0066** 1970.0029 198-2.28 1990.024 200School distance 201-0.0039 2020.0099 203-0.40 2040.688 205Open space distance 206-0.0052* 2070.0027 208-2.90 2090.060 210Ventilation 2110.0121** 2120.0059 2132.05 2140.042 215Waterlogging 216-0.0151* 2170.0083 218-3.82 2190.070 220Landfill 221-0.0101 2220.0075 223-1.36 2240.176 225Drainage/Sewage 2260.0222*** 2270.0053 2284.18 2290.000 230Constant 2313.6671 2320.0449 23381.66 2340.000 235N= 210; F(11,198); = 669.82; Prob.>F= 0.0000 ; R2 = 0.9543; VIF=4.07 236Note: Significant at: ***p<0.01, **p<0.05, *p<0.1 237 238The results estimated from the hedonic pricing approach of equation (8) 239are reported in Table 3. It is found that the value of R2 is 0.9543 indicates that 240about 95% of variations in the dependent variable are explained by the 241variations in explanatory variables taken in the model. Multicollinearity 242problem is diagnosed by VIF test which is 4.07, specifies that the regression 243model is free from multicollinearity problem. From the obtained result it is also 244revealed that the sum of residual is equal to zero and the distribution of 245residual is normal 246The Table highlights the determinants of house rent are classified by four 247attributes. Income is found positively and highly significant associated with 248house rent at 1 percent level of significance, keeping other things being 249constant. In regarding structural attributes, the age of building, the number of 250rooms, space for garages are the most relevant factors that determine the 251extent of house rent. The number of rooms is significant at the 5 percent level, 252indicating that an increase of one unit in the number of rooms is connected 253with a 1 percent rise in housing rent, provided other factors remain constant. 254The workplace distance is significant at 5% level of significance and 255negatively influences house rent. The most important and relevant attribute is 256the environmental attributes which include distance of open space; at least a 257small playground from house, the condition of ventilation of house which is 258measured by 1-5 point scale where 1 indicates the strongly unsatisfactory 259condition and 5 indicates strongly satisfactory condition, waterlogging and 260landfill are categorical variable where 0 indicates absence of that factor and 1 261indicates presence of that factor, and drainage/sewage system which is also 262measured by 1-5 point scale where 1 indicates the strongly unsatisfactory 263condition and 5 indicates strongly satisfactory condition. Here, distance of open 264265266===== PAGE 13 (score 33, numeric-paren 8, table-words 4, var-words 13) =====267268 269 270 271SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 27213 273Sobhan, M., A., Hossain, M., E., Ahmed, R., Bapari, M., Y. (2025) The Impacts of 274Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable 275Urban Development Align with SDG 11 276space; at least a small playground from house is significant at 10% level of 277significance and negatively associated with house rent. Truly speaking, tenants 278are less agreed to pay more for the house if open space distance increases. It 279implies that a one unit increase in the open space distance is associated with a 280reduction in house rent by 0.5 percent, being remain constant other factors. 281The ventilation and drainage are measured by 1–5-point scale and it is observed 282that they are positively significant at 5 and 1 percent level of significance 283respectively. It implies that a one-unit increase in the condition of ventilation 284and drainage is associated with rise in house rent by 1 and 2 percent 285respectively, being remain constant other factors. The rest of the factors like 286waterlogging and landfill are negatively associated reducing house rent by 1 287percent being remain constant other factors. 288 2894.3 DETERMINANTS OF HOUSE RENT IN PLANNED AREA, RAJSHAHI CITY 290CORPORATION 291 292The planned residential area where everything is monitored by central 293authority, it is found that income is significantly associated with house rent at 2941 percent level of significance. Among the three structural attributes, the 295number of rooms are significant at 5 percent level of significance which implies 296that, a one-unit increase in the number of room is associated with rise in house 297rent by 0.3 percent, being remain constant other factors. 298 299Table 4 300Regression Result of a Hedonic pricing Approach of Planned Area. 301Explanatory variable 302Coefficient 303Robust Std. Err. 304t-ratio 305P-Value 306Income 307.0000011*** 308.0000003 3093.22 3100.002 311Age of house 312-0.0044*** 3130.0016 314-2.68 3150.009 316Room number 3170.0039** 3180.0017 3192.23 3200.028 321Garage 3220.0137*** 3230.0043 3243.16 3250.002 326 327Work place distance 328-0.0100*** 3290.0030 330-3.33 3310.001 332School distance 333-0.0217 3340.0165 335-1.32 3360.192 337Open space distance 338-0.0117*** 3390.0038 340-5.25 3410.000 342Ventilation 3430.0117*** 3440.0027 3454.27 3460.000 347Waterlogging 348-0.0118* 3490.0062 350-2.91 3510.059 352Landfill 353-0.0028 3540.0041 355-0.68 3560.497 357Drainage/Sewage 3580.0046** 3590.0022 3602.05 3610.043 362Constant 3634.0504 3640.0410 36598.76 3660.000 367368369===== PAGE 14 (score 27, numeric-paren 3, table-words 5, var-words 11) =====370371 372 373 374SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 37514 376Sobhan, M., A., Hossain, M., E., Ahmed, R., Bapari, M., Y. (2025) The Impacts of 377Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable 378Urban Development Align with SDG 11 379 380The workplace distance is significant at 1% level of significance and 381negatively influences house rent. Here, distance of open space; at least a small 382playground from house is significant at 1% level of significance and negatively 383associated with house rent. It implies that a one-unit increase in the open space 384distance is associated with reduce in house rent by 1.1 percent, being remain 385constant other factors. The ventilation and drainage are measured by 5-point 386scale and it is observed that only ventilation is positively significant at 1 percent 387level of significance. It implies that a one-unit increase in the condition of 388ventilation is associated with rise in house rent by 1.1 percent, being remain 389constant other factors. The drainage is significant at 5 percent level of 390significance and its sign is positively related to determine the extent of house 391rent. The rest of the factors like waterlogging and landfill are negatively 392associated with house rents. 393 3944.4 DETERMINANTS OF HOUSE RENT IN UNPLANNED AREA, RAJSHAHI CITY 395CORPORATION 396 397The rest of the factors like waterlogging and landfill are negatively 398significant at 10 percent level of significance suggesting that a one-unit 399increase in waterlogging and landfill associated with reducing house rent by 1 400percent being remain constant other factors. These findings highlight the 401negative impact of underprivileged environmental circumstances on rental 402value of houses in unplanned areas. 403 404Table 5 405Regression Result of the Hedonic Pricing Approach of Unplanned Area. 406Explanatory variable 407Coefficient 408Std. Err. 409t-ratio 410P-Value 411Income 4120.00000104 413.0000005 4141.85 4150.068 416Age of house 417-0.00008 4180.0019 419-0.05 4200.964 421Room number 4220.0202* 4230.0110 4241.83 4250.070 426Garage 4270.0081 4280.0079 4291.02 4300.309 431Work place distance 432-0.0050 * 4330.0029 434-1.73 4350.087 436School distance 437-0.0035 4380.0265 439-0.14 4400.893 441Open space distance 442-0.0066** 4430.0032 444-2.03 4450.045 446Ventilation 4470.0094 4480.0079 4491.18 4500.240 451N= 100; F(11,88); = 196.69; Prob>F= 0.0000 ; R2 = 0.9531; Root MSE= 0.01605; VIF=3.52 452Note: Significant at: ***p<0.01, **p<0.05, *p<0.1 453454455===== PAGE 15 (score 20, numeric-paren 3, table-words 3, var-words 6) =====456457 458 459 460SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 46115 462Sobhan, M., A., Hossain, M., E., Ahmed, R., Bapari, M., Y. (2025) The Impacts of 463Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable 464Urban Development Align with SDG 11 465Waterlogging 466-0.0104* 4670.0062 468-1.67 4690.098 470Landfill 471-0.0146* 4720.0075 473-1.93 4740.056 475Drainage/Sewage 4760.0114* 4770.0059 4781.94 4790.055 480Constant 4813.6834 4820.1237 48329.78 4840.000 485N= 110; F(11,98); = 99.79; Prob.>F= 0.0000 ; R2 = 0.8798; Root MSE= 0.02678; VIF=3.59 486Note: Significant at: ***p<0.01, **p<0.05, *p<0.1 487 488The unplanned area where socio-economic activities are not governed by 489a central authority it is found that certain factors significantly influence house 490rents. The distance of open space is significant at 5 percent level of significance 491and negatively associated with house rent. The ventilation and drainage are 492positively significant at 10 percent level of significance. Unfortunately, the 493ventilation is not significant, but its sign is positively related to determine the 494extent of house rent. 495 4964.5 THE WILLINGNESS TO PAY FOR ENVIRONMENTAL ATTRIBUTES 497 498This study reveals the tenant’s willingness to pay value of environmental 499amenities and dis-amenities and other attributes from estimated coefficients 500of equation (8) & (9) which is reported in Table 6. In overall area, structural 501attributes including age of house, the tenants are willing to pay less BDT 51.33 502(US $0.42) for age of house whereas willing to pay more for room number, and 503garage availability are BDT 104.840 (US $0.87) and BDT 113.109 (US $0.94) 504respectively from their average rent. 505 506Table 6 507Results of Willingness to Pay Analysis. 508l 509Overall Area 510Planned Area 511Unplanned Area 512Attributes 513WTP(BDT) 514WTP(US$) WTP(BDT) 515WTP(US$) WTP(BDT) 516WTP(US$) 517Structural Attributes 518Age house 519-51.33 520-0.42 521-61.201 522-0.51 523 524-0.54 525-0.004 526 527Room 528number 529104.840 5300.87 53154.472 5320.45 533 534139.777 5351.16 536 537Garage 538availability 539113.109 5400.94 541192.292 5421.60 543 54455.710 5450.46 546 547Neighborhood Attributes 548Work place 549proximity 550-67.27 551-0.56 552-138.705 553-1.15 554 555-34.164 556-0.28 557 558School 559proximity 560-39.80 561-0.33 562-299.24 563-2.49 564 565-23.933 566-0.19 567 568Environmental Attributes 569570571===== PAGE 16 (score 12, numeric-paren 0, table-words 0, var-words 6) =====572573 574 575 576SDGsReview | Florida, USA | VOL. 5| e02806| pag: 01-22| 2025. 57716 578Sobhan, M., A., Hossain, M., E., Ahmed, R., Bapari, M., Y. (2025) The Impacts of 579Environmental Amenities on Rental Value of Houses and a Pathway Towards Sustainable 580Urban Development Align with SDG 11 581Open 582space 583proximity 584-53.038 585-0.44 586-162.148 587-1.35 588 589-45.061 590-0.37 591 592Ventilation 593availabity 594124.488 5951.03 596164.055 5971.36 598 59964.693 6000.53 601 602Waterlog 603presence 604-153.255 605-1.27 606-163.525 607-1.36 608 609-70.870 610-0.59 611 612Landfill 613presence 614-102.765 615-0.85 616-38.977 617-0.32 618 619-99.283 620-0.82 621 622Drainage 623229.560 6241.91 62564.271 6260.53 627 62878.536 6290.65 630 631 632In case of neighborhood attributes including workplace and school 633proximity, the tenants are willing to pay more BDT 67.27 (US $0.56) and BDT 63439.80 (US $0.33) from their average rent because of an additional unit of closer 635proximity. Among the environmental attributes in case of open space proximity, 636tenants are willing to pay more BDT 53.038 (US $0.44) from their average rent 637with an additional unit of closer proximity. In accordance with ventilation 638facilities and proper drainage management system, the tenants are willing to 639pay more BDT 124.488 (US $1.03) and BDT 229.560 (US $1.91) from their 640average rent because of an additional unit increase in 5-point scale from 641strongly unsatisfactory to strongly satisfactory. In contrast, tenants are willing 642to pay less BDT 153.255 (US $1.27) and BDT 102.765 (US $0.85) from their 643average rent because of an additional unit increase in waterlog and landfill 644availabilities. 645In the planned area, in case of structural attributes including age of 646house, the tenants are willing to pay less BDT 61.201 (US $0.51), while are 647willing to pay more for room numbers, and garage availability are BDT 54.472 648(US $0.45) and BDT 192.292 (US $1.60) respectively from their average rent. In 649case of neighborhood attributes including workplace and school proximity, the 650tenants are willing to pay more BDT 138.705 (US $1.15) and BDT 299.24 (US 651$2.49) from their average rent. Regarding environmental attributes due to open 652space proximity, tenants are willing to pay more BDT 162.148 (US $1.35) from 653their average rent with an additional unit of closer proximity. Besides, presence 654of ventilation facilities and proper drainage management system, the tenants 655are willing to pay more BDT 164.055 (US $1.36) and BDT 64.271 (US $0.53) from 656their average rent. In contrast, tenants are willing to pay less BDT 163.525 (US 657