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Micro-Economic Analysis on the Optimal Maintenance, and the Optimal Choice between Remodeling and Redevelopment of an Old House

Lee, Young-Man 1 배순석 2

1한성대학교
2국토연구원

Accredited

ABSTRACT

The main purpose of this paper is to find out policy implications after analysing the factors that affect the housing owners to make decision on the level of housing improvement (or maintenance); improvement timing; and the method of housing improvement (for example housing reconstruction vs. remodelling). The analysis was carried out assuming that every housing owner makes decision so that he/she could maximize the housing unit value. The main findings from the analysis can be summarized as the following: - the optimal timing for development gets delayed as the economic growth rate gets lower - where the economic growth rate is high, housing owners prefer housing reconstruction to housing remodelling. - the optimal maintenance expenditure gets smaller where building density is lower; where the housing unit value is lower; and where the economic growth rate is higher.

Citation status

* References for papers published after 2022 are currently being built.