Abstract
AbstractWe introduce the first publicly available data set of constant‐quality house price indices for counties, ZIP codes and census tracts in the United States, at an annual frequency, over a 40‐year period. Between 1990 and 2015, house price gradients within large cities steepen, documenting a reversal of decades of increasing relative desirability of suburban locations. Real house prices are more likely to be nonstationary near the centers of large cities. Within‐city differences in house price appreciation at the ZIP code level are, on average, about half of between‐city differences, though this ratio varies depending on the time period and city size.
Highlights
Much of the 20th century in the United States can be characterized as one of suburbanization
We introduce the Standard Urban Model (SUM) as it relates to transportation costs in order to frame the discussion of facts revealed by our house price indices
This paper introduces a new panel of annual house price indices from 1975 through 2015
Summary
Much of the 20th century in the United States can be characterized as one of suburbanization. Popular media is awash in articles on “millennials,” (New York Times, 2014) and the rise of center-cities as destinations for the young and eager “creative class” (Florida, 2004; Couture and Handbury, 2016) This is coincident with Moretti’s (2012) “Great Divergence” of jobs, income, and increased inequality in U.S cities (see Diamond, 2016). Limited transactions data prior to the late 1980s or early 1990s, forcing reliance on geographic pooling of transactions, smoothing of series over space or time, or limiting coverage.2 To address this gap in the availability of constant-quality house price measures, we construct a comprehensive set of annual HPIs over four decades for cities, counties, 3-digit ZIP codes (ZIP3s), and 5-digit ZIP codes (ZIP5s) using a repeat-sales methodology.. The final section concludes with a summary, implications, and potential applications of these new house price indices
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