Applications of HPM related to tourism
Most studies using the HPM have been concern with the impact of amenity resources, such as those which have considered the effect of the proximity of environmental and neighbouhood variables on residential property prices, for example a forest or nature reserve or water courses. They are relevant to tourism in that the methodology may also be used to estimate the effect of such variable on holiday prices as well as identifying and measuring the environmental impact of tourism. Davis (1964) was a pioneer in applying the method to big game hunting in a forest. Garrod and Willis(1991) found that the presence of forestry might have a large positive impact. A similar result is observed in the case of location near waterways. Willis and Garrod (1993) estimate that the presence of a canal or river raises the value of a property by an average of 4.9 per cent, while the proximity of at least 20 per cent woodland cover raises it by 7.1 per cent above that of an identical property without these features. More recent examples of the application are by Pendleton (1999) and Peason et al. (2002).
There also exists a significant body of research, who possible relevance to tourism in historic urban areas, into the impact of architectural style and historic zone designation on property valuation. Asabere et al. (1989), for example, showed that architectural style has a strong impact on residential property valuation in their sample of 500 properties sold in Newport, Massachusette USA, between 1983 and 1985, with older styles of architecture commanding premium of around 20 per cent. Moorhouse and Smith (1994), in their study of nineteenth-century terraced house in Boston, also found that individuality of any style commanded a higher price. Hough and Kratz (1983) argued that architecture has certain public good characteristics which may be undervalues in the market, while Ford(1989) evaluated the effect of historic district designation on the prices of properties sold in Baltimore, Maryland, USA, between 1980 and 1985. Designation was found to have a positive but insignificant impact. This result was corroborated by Asabere et al. (1989) and also by Schaeffer and Millerick (1991) in their study of the prices of 252 properties, prior to and after designation in Chicago.
A related are of study in which the HPM has been used is in research on the pricing of package holidays where environmental characteristics are part of the tourism package. The price competitiveness of package holidays cannot be compared directly because of difference in the characteristics of the package supplied. However, the HPM can be used to estimate the price difference, which are due to variations in the mixes of characteristics. For instance, in the case of holidays in the Spanish province of Malaga offered by UK tour operators, the characteristics included the categories of hotels and the tourist resorts themselves, all of which affected the prices of the holidays. The HPM has also been used to compare the price competitiveness of package holidays in cities supplied by tour operators from difference countries (Clewer et al. 1992)