The Value of Residential Land and Structures during the Great Housing Boom and Bust

Abstract

This study examines how the value of residential land and structures evolved during the great housing boom and bust, using data on more than a million residential properties that were sold in 10 metropolitan areas between 1998 and 2009. We use a hedonic estimator to disentangle the market value of land and structures at a local (Census tract) level. Our estimates reveal substantial heterogeneity in the evolution of the market value of land and structures within metropolitan areas. Surprisingly, lower-value land at the urban fringes of metropolitan areas was the most volatile during the boom-bust. (JEL R14, R21)