Recent rapid population growth and increasing urbanisation have led to fast vertical developments in urban areas. Therefore, in the context of the dynamic property market, factors related to the third dimension (3D) need to be considered. Current hedonic price modelling (HPM) studies have little explicit consideration for the third dimension, which may have a significant influence on modelling property values in complex urban environments. Therefore, our research aims to narrow the cognitive gap of the missing third dimension by assessing both 2D and 3D HPM and identifying important 3D factors for spatial analysis and visualisation in the selected study area, Xi’an, China. The statistical methods we used for 2D HPM are ordinary least squares (OLS) and geographically weighted regression (GWR). In 2D HPM, they both have very low R² (0.111 in OLS and 0.217 in GWR), showing a very limited generalisation potential. However, a significant improvement is observed when adding 3D factors, namely view quality, sky view factor (SVF), sunlight and property orientation. The obtained higher R² (0.414) shows the importance of the third dimension or—3D factors for HPM. Our findings demonstrate the necessity to include such factors into HPM and to develop 3D models with a higher level of details (LoD) to serve more purposes such as fair property taxation.

Increasing urbanisation has inevitably led to the continuous construction of buildings. Urban expansion and densification processes reshape cities and, in particular, the third dimension (3D), thus calling for a technical shift from 2D to 3D for property valuation. However, most property valuation studies employ 2D geoinformation in hedonic price models, while the benefits of 3D modelling potentially brought for property valuation and the general context of digital twin (DT) creation are not sufficiently explored. Therefore, this review aims to identify appropriate urban 3D modelling method(s) for city DT, which can be used for 3D property valuation (3DPV) in the future (both short-term and long-term). We focused on 3D modelling studies investigating buildings and urban elements directly linked with residential properties. In total, 180 peer-reviewed journal papers were selected between 2016 and 2020 with a narrative review approach. Analytical criteria for 3D modelling methods were explicitly defined and covered four aspects: metadata, technical characteristics, users’ requirements, and ethical considerations. From this, we derived short-term and long-term prospects for 3DPV. The results provide references for integrating 3D modelling and DT in property valuation and call for interdisciplinary collaboration including researchers and stakeholders in the real estate sector, such as real estate companies, house buyers and local governments.

As urbanisation accelerates, the urban landscape reshapes at a fast pace. Consequently, the urban built environment continuously evolves horizontally as well as vertically. However, more attention in the field of spatial analysis is given to horizontal dynamics, despite the importance of geoinformation in the vertical dimension. 3D modelling methods have gained popularity due to their powerful capability of capturing and analysing geoinformation in the vertical dimension and visualising objects lifelike in the urban built environment. Various urban applications with diverse 3D modelling methods at different research scales and purposes have emerged. However, there is no systematic overview of these different modelling methods. Therefore, it is imperative to provide an up-to-date review of these advances. In this paper, we aim to review urban 3D modelling methods widely used in the prior 5-year period (2015–2020). Our analysis focuses on five attributes, i.e., basic characteristics, data requirements, technical requirements, users requirements and ethical considerations. The discussion presents the current status of 3D modelling methods – a wide range of applications yet with substantial development potential. This paper closes with insights for future work regarding the necessities of 3D data structure support as well as interdisciplinary research, specifically for big data management and integration.