Hedonic price model,a tool to analyze and assess commercial housing price,is widely used in the field of real estate.Based on the fact that there are more multiple choice linear and more independent variables in practical application,this paper proposes that principal component analysis should be adopted to improve characteristic model of commercial housing and exclude the error generated by the linear correlation between the variables of the hedonic price model.Meanwhile,this paper chooses commercial residential real estate along Wuhan rail as the research object,constructs the commercial housing hedonic price model based on principal component analysis and compares the predicting results of commercial housing price and actual sales prices.The result shows that the majority of the sample forecast errors is under 5%,which verified the advantages of the improved model.