Building depreciation and sustainable development

Abstract

Sustainable development is a hot topic, but is mostly referred to environmental protection, although it encompasses environmental, social and economic developments as defined by the United Nations. Worse still, the impacts of building maintenance on sustainable (economic) development are almost totally ignored. This paper aims to carry out the first sensitivity analysis of the impacts of housing depreciation on sustainable development in Hong Kong. The analysis is based on an empirical result of the housing depreciation rate and an estimation of the ageing trend of housing in Hong Kong. The results highlight the utmost importance of building maintenance on achieving sustainable development. It does not only reduce construction waste, but it also enhances the total asset value of the city. For example, the analysis shows that a 10 per cent reduction of housing depreciation would yield about 14 per cent increase in gross domestic product (GDP) in a decade, but it just costs about 2.3 per cent of GDP. © 2007 Palgrave MacMillan Ltd.