Toward 3D Property Valuation—A Review of Urban 3D Modelling Methods for Digital Twin Creation

Abstract

Increasing urbanisation has inevitably led to the continuous construction of buildings. Urban expansion and densification processes reshape cities and, in particular, the third dimension (3D), thus calling for a technical shift from 2D to 3D for property valuation. However, most property valuation studies employ 2D geoinformation in hedonic price models, while the benefits of 3D modelling potentially brought for property valuation and the general context of digital twin (DT) creation are not sufficiently explored. Therefore, this review aims to identify appropriate urban 3D modelling method(s) for city DT, which can be used for 3D property valuation (3DPV) in the future (both short-term and long-term). We focused on 3D modelling studies investigating buildings and urban elements directly linked with residential properties. In total, 180 peer-reviewed journal papers were selected between 2016 and 2020 with a narrative review approach. Analytical criteria for 3D modelling methods were explicitly defined and covered four aspects: metadata, technical characteristics, users’ requirements, and ethical considerations. From this, we derived short-term and long-term prospects for 3DPV. The results provide references for integrating 3D modelling and DT in property valuation and call for interdisciplinary collaboration including researchers and stakeholders in the real estate sector, such as real estate companies, house buyers and local governments.

A Comprehensive Overview Regarding the Impact of GIS on Property Valuation

“…The approach proposed in [43] emphasizes a logical and rational aggregation based on a set of property attributes with location attributes and other valuation factors determined by spatial analysis using GIS and a multi-criteria valuation system. To expand the detailed characteristics of real estate, researchers are exploring the integration of three-dimensional (3D) information into valuation practice, which could significantly improve the estimation and explanation of individual property values [44][45][46][47]. Alternatively, some researchers argue for the integration of advanced technologies such as 3D cadaster and Building Information Modeling (BIM) into property valuation.…”

Assessing the Status and Challenges of Urban Land Administration Systems Using Framework for Effective Land Administration (FELA): A Case Study in Pakistan

“…In the near future, the Government of Pakistan is keen on promoting the vertical growth of cities [113][114][115]. In developed economies, the computerization of land records through Information and Communication Technology (ICT) and GIS is evolving into a 3D LAS that incorporates vertical urban development [116][117][118][119][120]. The Australian future vision of a 3D LAS accommodates the digital economy, smart cities, and vertical development for social welfare and economic prosperity.…”

BIM and real estate valuation: challenges, potentials and lessons for future directions

“…The possible application of BIM for real estate valuation procedures was initially recommended by L€ utzkendorf and Lorenz (2011) when assessing sustainability characteristics for improving and complementing the customary drivers of real estate economic value. BIM was then introduced as an opportunity for the provision of different real estate services such as valuation (Mahdjoubi et al, 2013;Wilkinson and Jupp, 2016;Starr et al, 2021;Emekli and Guney, 2019;Ullah et al, 2018;Biljecki et al, 2015;Ying, 2019).…”