Building more homes and buildings with wood has been on the radar for years as a way to offset carbon emissions, though construction companies have been hesitant to take the material in broader use. A study is now the first to show that building with wood can be a sound investment. The findings show that multi-storied buildings made out of wood sold for an average of 8.85% more than those made from other materials.

The team analysed statistical data from real estate sales in the Finnish capital of Helsinki and two suburbs, from 1999 to 2018. Of these, timber-built homes made up 2.23% of cases. The findings show that multi-storied buildings made out of wood sold for an average of 8.85% more than those made from other materials.

Previous research has pointed to perceptions of higher costs in wood construction, and until now there have been no definitive results on the material’s economic feasibility. Since many things can affect price, the researchers used regression analysis to control for other potential factors.

‘At first glance multi-story housing blocks made out of wood appear to be cheaper on average but when we look more closely at the data and control for location, we see that it’s economically advantageous to use wood. The results show that wood-based housing is almost 10% more expensive per square metre than concrete-based housing in the same area,’ explains Seppo Junnila, professor of real estate business at Aalto University.

Price differences between wood and other construction materials were not seen in the suburbs studied. The researchers say this may have to do with the fact that timber-based construction in Helsinki occurs in cheaper-than-average areas, where people may be more willing to pay for the eco-friendly material.

‘These days many consumers value ecological choices and, at the same time, want to communicate their green preferences to others. Our results show that wooden buildings are located more often in areas with lower socio-economic status — wood is what boosts their prices,’ explains Doctoral Student Ilmari Talvitie.

Story Source: Materials provided by Aalto University. Note: Content may be edited for style and length.