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The Research of the Computation Method for the Ratio of Land Price to House Price

The ratio of land price to house price (LPHP-ratio) is an indicator commonly used to reflect the relationship between house price and land price. However, the precise computation method for the ratio has long remained unspecific, and the different results using different computation methods will exert different influence upon people's perception and judgment of the real relationship between house price and land price. Three different types of LPHP-ratios, namely Static-LPHP-ratio, Dynamic-LPHP-ratio and Internal-LPHP-ratio are proposed in this paper using different methods of computation. An empirical study on the real estate market in Hangzhou during the period 2003-2008 is reported and discussed in the following.