Property values, parks, and crime: A hedonic analysis in Baltimore, MD

Abstract

While urban parks are generally considered to be a positive amenity, past research suggests that some parks are perceived as a neighborhood liability. Using hedonic analysis of property data in Baltimore, MD, we attempted to determine whether crime rate mediates how parks are valued by the housing market. Transacted price was regressed against park proximity, area-weighted robbery and rape rates for the Census block groups encompassing the parks, and an interaction term, adjusting for a number of other variables. Four models were estimated, including one where selling price was log-transformed but distance to park was not, one where both were log-transformed, a Box–Cox regression, and a spatially adjusted regression. All results indicate that park proximity is positively valued by the housing market where the combined robbery and rape rates for a neighborhood are below a certain threshold rate but negatively valued where above that threshold. Depending on which model is used, this threshold occurs at a crime index value of between 406 and 484 (that is, between 406% and 484% of the national average; the average rate by block group for Baltimore is 475% of the national average). For all models, the further the crime index value is from the threshold value for a particular property, the steeper the relationship is between park proximity and home value.