An ANP framework for property pricing combining quantitative and qualitative attributes

Abstract

This paper presents a new comparative methodology for the valuation of urban properties based on the Analytic Network Process (ANP), with the twin objective of overcoming the drawbacks found in classical urban valuation methods and enhancing the current set of tools available for the appraiser. The ANP enables to tackle contexts in which scant information is available, qualitative variables are considered and, unlike the Analytic Hierarchy Process, interdependences among variables are present, all very common situations in professional valuation practice, so this study proposes its application to the field of urban valuation. To illustrate the new proposal, a real case study is put forward alongside four different models for solving it, with the aim of analysing the varying accuracy of each model. It may be concluded that the more information taken into account in relation to the interdependences between criteria and alternatives, the greater the accuracy of the results.

Keywords:

• multicriteria valuation
• urban appraisal
• AHP
• ANP
• goal programming

Acknowledgements

The authors would like to thank the company Tabimed for the information supplied for this study to be undertaken and the R&D&I Linguistic Assistance Office, Universidad Politécnica de Valencia (Spain), for translating the paper. They are also grateful for the finance received from the Spanish Ministry of Education and Science charged to research project SEJ2007-67937. Referees’ suggestions have considerably improved the final version of this work.