Building information modeling potential for an enhanced real estate valuation approach based on the hedonic method

Housing valuation is a process of determining an accurate estimate of the market price of a property. Current methods and tools are mainly based on sales prices comparison with recent transactions, which is the major method applied in the taxation and cadastre services in Morocco. However, housing properties are in general heterogenous and unique in their shapes, construction materials, orientation, location and other environmental factors. These parameters are taken into consideration by the hedonic pricing method. Many of the researches about housing valuation are based on the geographical location as the main spatial factor affecting the property value. 2D GIS (Geographic Information System) applications used in this respect are limited in terms of communicating efficiently the complexity of a 3D building structure and modeling accurately environmental factors. Such factors could only be considered through 3D modeling and building information modeling (BIM). In this paper, we will try, through a brief review, to point out the weaknesses and drawbacks of the conventional valuation methods. Then, we will demonstrate the BIM potential in real valuation as an emerging technology and process used to mainly improve the housing valuation system based on the hedonic approach. Many studies are, nowadays, widely exploring the use of BIM in the building cost estimation, but this is an embryonic area of research in real estate valuation system. Therefore, this paper examines also the first methodological guidelines for an advanced housing valuation approach by implementing a BIM prototype based on the hedonic pricing method.