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Due to economic and population growth farmland and to a lesser extend other undeveloped areas areunder pressure in the urban-rural fringe in British Columbia, Canada. The objectives of this paper areto determine if residential property values near Victoria, BC include open-space premiums forfarmland or parks or both, and to determine if using assessed values instead of market prices of theproperty result in the same findings. We estimate a SUR (Seemingly Unrelated Regression) model withtwo hedonic pricing equations, one with actual market values as the dependent variable and one withassessed property values, and compare the resulting estimates of shadow prices for open spaceamenities. Furthermore, we take account of spatial autocorrelation and combine Method of Momentestimates of the spatial parameters in both equations.
