Announcement effects of urban regeneration plans on residential property values: Evidence from Ulsan, Korea

Abstract

This article examines whether, and to what extent, the announcement of new urban regeneration plans has influenced residential property values in Ulsan, Korea, where state-led initiatives have recently taken place to revitalize urban core areas in a more incremental and participatory manner. This is accomplished by analyzing data for single-family residential properties sold from January 2014 to December 2016 in the Ulsan Metropolitan area. A sample of 7139 transactions is used for hedonic analysis with consideration of the detailed timing of plan information dissemination from the beginning of the planning process to the release of the final plan. The results showed that the urban regeneration strategic plan's release in December 2015 had a significant influence on the values of residential properties within and around the project sites, but this influence varied across neighborhoods. The effect of the plan release was found to be most significant in/around the project sites where residents showed a high level of willingness to participate. In these areas, price escalations were found to occur even before the release of the final plan, suggesting that appropriate planning interventions are required at early stages of urban regeneration projects to protect vulnerable groups of residents from potential displacement.