The primary objective of every government is to protect its citizens from exploitation from unscrupulous traders who might want to benefit unfairly. The search for tools and techniques to tame unfair exploitation of citizens has resulted to the development of many market measures. Some of this measures have being rated by the body involved as either fair or unfair depending on results and cost involved to determine the cost of a specific type of a product in the market. Due to this effect, hedonic method has being rated as one of the best measure to value the price of goods and services at the market places. This method is referred by many as the process of determining the value of good and services based on the external characteristics. E.g. near road, electricity, water, schools and other service providers’ stations. Land value is always determined by the above factors. It is assumed that customers value more the characteristic of a product as compared to the service intended to be offered by that product. Hedonic method therefore is used to determine the characteristic of that product in question.
The extents to which every characteristic affect the product in concern determine the value of that product. For example when buying a house, a willing buyer and seller decide to use the hedonic method as a tool to determine the value of that house. The following characteristics of that house in question will be put in consideration. Security status in the house location and the value of other houses are a priority to all willing buyers. Good security affects the price of that house in question positively. If the house is located near a road net work, health services, good schools and approximately near shopping centre among other service providing centres will scale up the price of that house.
Although hedonic method has its critics, it has been consistently used to track changes by sellers and buyers in the market. The reason for this unstoppable method to be used is because of its importance in property market. The main strength in hedonic method is the fact that the value of item on sale is determined based on actual facts. Consumer of the product can identify the characteristics of his choice to the product. These reasons therefore, make the consumer of the product on sale able to choose among the competing goods in the market. By the use of hedonic method, the consumer satisfaction is always expected to be attained because he or she made a decision to buy a product based on his or her preferences. The value of consumer’s money is felt. Here, consumers are always attracted by the characteristics goods and services they need therefore providing a value measuring tool in the markets.
Another noticeable reason for a wide use of hedonic method is that this method is always affordable. Data collection is easy, holding the fact that they are readily available on the ground. For example it is easier to note the social status of the living class in the area, schools and road networks that will be put on board when determining the value of the land or a house. The reliability of this method motivates many to use it. It does not call for a professional to determine how close the house is to the road. These facts encourage many to support hedonic method as because it accommodates all stake holders in the selling process. To add on this, there are many sources of data that can be relied on when using hedonic method. One is allowed to consult right from the government sources to the locals on the product in subject. To summarize, hedonic method is said to be efficiently responsive to various changes in fluctuating markets hence making it the most relied on in determining the value of goods and services in property industries.