Nearby Residential Property Research Articles

Spillover effects of business improvement districts on residential housing values: a focus on the northern region in Los Angeles county, California

ABSTRACT In response to the decline in commercial areas, there has been a growing interest in the implementation of Business Improvement Districts (BIDs) in large developed cities in North America. However, there is limited understanding of whether BIDs have economic effects on surrounding neighbourhoods. This study aims to answer the following research question: do BIDs positively affect nearby residential properties? To analyze the influence of BIDs on the housing market, we examined single- and multi-family home sale transactions between 1995 and 2007 in the City of Los Angeles, California. We employed the Adjusted Interrupted Time Series Difference in Differences (AITS DID) model to analyze changes in both the price levels and trends of housing values, and to establish the causal impact associated with the implementation of BIDs. Our findings show that the implementation of BIDs had a significant impact on the value of properties located within a 1/2 mile of the BIDs in single- and multi-family homes, as well as in low-income neighbourhoods. The findings from this study will provide valuable insights for planners, residents, and local governments to better comprehend the heterogeneous nature of spillover effects associated with BID programs.

Capitalized value of evolving flood risks discount and nature-based solution premiums on property prices

Nature-based solutions (NbS) are a cornerstone of climate change adaptation worldwide. Yet, evidence on their economic benefits is scarce, especially since the provided environmental amenities usually spatially correlate with climate-induced hazards, effects of which NbS aim to curb. This lack of empirical evidence creates obscurity regarding social acceptability of NbS, hindering their uptake and upscaling. We apply hedonic price models to estimate homeowners' willingness-to-pay for NbS, which offer flood safety and environmental benefits, while controlling for spatio-temporal changes in capitalized flood risk discounts due to the 1993-1995 floods in the Limburg Province, the Netherlands. We reveal a pre-flood effect of 5.6% (discounting on average -€12,753 for flood-prone properties), which rises to 10.9% (−€24,691 on average) immediately after the floods. However, the effect is only transitory. The flood discount of home values diminishes over time and eventually vanishes in 9–12 years, which coincides with the implementation of the largest and oldest NbS intervention in the Netherlands. Our analysis shows that NbS amenities provide a 15% (€33,687 on average) premium to nearby residential property prices. This evidence of the evolving flood risk discount and the stable NbS premium for individual homeowners could support the economic feasibility and wide acceptability of NbS for climate change adaptations.

Impact of Urban Regeneration on the Housing Prices: Wangsa Maju – Maluri

Urban regeneration is a planning tool used by the urban planner to improve the environment through generating positive externalities and minimizing negative externalities. In addition, an improved environment can provide benefits on the nearby residential property value via value appreciation that will affect the property price in the long run. Hence in this paper, the impact of urban regeneration on the housing prices in Maluri is empirically investigated. By using the quantitative method, the paper aims to determine the housing attributes that influence the housing prices in Maluri and to investigate the impact of urban regeneration on the housing prices in the selected case study area. A total of 1,376 housing sales transaction data were analyzed via SPSS and Microsoft Excel. For the hedonic pricing model, the results reveal that the number of bedroom attribute has the most influenced on the housing prices in Maluri. The floor level attribute, built-up area attribute and land area attribute are revealed to have a positive influence in affecting housing prices in Maluri. For examining the location-time interaction between the case study area and the different stages of urban regeneration, namely before regeneration, during regeneration and after regeneration; a price gradient analysis is adopted. The findings conclude that there were significant increases recorded in Maluri housing prices between before the regeneration stage and after the regeneration stage although the price difference is varied across zones. This proves that due to the impact of urban regeneration, the housing prices in the case study area boost ahead of the project completion.

Transport infrastructure, accessibility and residential property values: evidence from Hong Kong

PurposeHong Kong, like many other developed cities and countries, invests heavily in transport development. This study investigates whether the speculative benefits of future improvements in accessibility, brought about by impending transport development, will be capitalized into nearby residential property values even prior to the opening of the development.Design/methodology/approachDeviating from the standard hedonic price approach, the present study employed a fixed-effects model with a large data set of residential property transactions in the vicinity of three-stations situated along a newly proposed mass-transit-railway line in Hong Kong.FindingsThe results suggest that the values of residential properties close to stations do reflect the accessibility enhancements to be brought about by transport improvements even before the opening of the line. Results revealed a 6.5% of property value premium after the announcement of construction; and higher up to 6.7% after the operation of the line. This indicates that forthcoming new transport-infrastructure development produces changes in spatial price-gradients for neighbouring residential properties. Findings indicate that potential buyers/investors recognized the positive benefits of the planned transportation development, even before completion of the project, and are ready to pay a premium for those properties close to railway stations, representing clear evidence that residential property prices/values, near stations, reflect anticipated accessibility enhancements brought about by transport improvements.Originality/valueThis study, using a novel approach – a fixed-effects model to capture the speculative benefits of future improvements in transport infrastructure – provides a positive hypothesis that expected benefits of future improvements in accessibility are capitalized into property values.

Do new housing units in your backyard raise your rents?

Abstract There is a growing debate about whether new housing units increase rents for immediately surrounding apartments. Some argue new market-rate development produces a supply effect, which should alleviate the demand pressure on existing housing units and decrease their rents. Others contend that new development will attract high-income households and new amenities, generating an amenity effect and driving up rents. I contribute to this debate by estimating the impact of new high-rises on nearby residential rents, residential property sales prices and restaurant openings in New York City. To address the selection bias that developers are more likely to build new high-rises in fast-appreciating areas, I restrict the sample to residential properties near approved new high-rises and exploit the plausibly exogenous timing of completion conditional upon the timing of approval. I provide event study evidence that within 500 ft, for every 10% increase in the housing stock, rents decrease by 1%; and for every 10% increase in the condo stock, condo sales prices decrease by 0.9%. In addition, I show that new high-rises attract new restaurants, which is consistent with the hypothesis about amenity effects. However, I find that the supply effect dominates the amenity effect, causing net reductions in the rents and sales prices of nearby residential properties.

Does concentration of social housing influence house prices? Evidence from New Zealand

PurposeHousing affordability in New Zealand is placing significant pressure on the country’s social housing sector with increased demand for public sector accommodation. A common belief suggests that social housing has a negative effect on nearby residential property values. This study aims to develop proximity and concentration measures of social housing to determine if their spatial distribution affects property values.Design/methodology/approachUsing over 32,000 residential sales transactions from Auckland (New Zealand) during a three-year period (2014–2016), this study applies standard hedonic OLS framework with the addition of spatial autoregressive model and spatiotemporal autoregressive model to test if proximity and concentration of social housing influence residential property values.FindingsThe research found that private houses that share boundaries with public housing are discounted by 1.7%–3.3% depending on the socio-economic status of the submarket. The authors find that wealthier submarkets are better equipped to absorbing negative externalities attached to social housing. Proximity measures tend to peak at 250 m, with houses discounted up to 5% within that distance. Concentration levels of social housing had a greater influence on the private residential market. At low levels of concentration, houses in areas of high and low socio-economic levels were discounted by approximately 6.5%. The discount does not remain uniform and the gap between the two areas is apparent at medium and high concentration levels. The negative effect was the highest − 23% – in the neighbourhoods that were socially and economically deprived.Originality/valueThe study’s findings can assist policymakers in informing strategies on the future social housing initiatives. The findings suggest that a dispersed development strategy that incorporates a balanced mix of tenure and socio-economic groups should be preferred over a high-density social housing concentrated in already deprived neighbourhoods.

The Impact of Sports Stadiums on Localized Commercial Activity: Evidence from a Business Improvement District

Local government funding of sports stadiums is frequently justified as stimulating economic activity despite consensus contrary findings in the academic literature. Though some studies have identified positive neighborhood effects from stadiums on nearby residential property, scant research exists regarding impacts on highly-localized commercial activity that is hypothesized to spur further local economic development. This analysis exploits the recent relocation of a professional baseball team from downtown Atlanta to a pre-existing Georgia Business Improvement District (Community Improvement District or CID) in suburban Cobb County to estimate the impact of the stadium development on commercial property values. The existence of multiple CIDs in the metro-Atlanta area provides the opportunity to estimate a counterfactual comparison absent the stadium to draw causal inference regarding the stadium’s impact on economic activity using the synthetic control method. Estimates do not identify increased commercial property values in the district following the stadium opening, which is consistent with past studies that find little to no positive impact on economic activity. The results indicate that previous findings of positive impacts on residential property may not be applicable to commercial property.

Impact of bus rapid transit on residential property prices in Auckland, New Zealand

Dubbed ‘The City of Cars’, congestion is a prominent issue in Auckland, New Zealand. Auckland's first Bus Rapid Transit (BRT) system - the Northern Busway - was implemented in 2008. The 6.2-km (km) busway network services the northern suburbs and provides a link to the Central Business District (CBD). This research aims to assess the impact of the Northern Busway on nearby residential property values. Spatio-temporal autoregressive (STAR) modelling is used to examine the accessibility impacts of the BRT under the difference – in – differences (DID) framework alongside a typical OLS and a strictly spatial model. We have observed two main findings. Firstly, the average sale price for properties in the treatment group (within 800 m of the Northern Busway) increased by approximately 3.69% as a result of the opening of the Northern Busway. Second, consistent with previous literature, we find that OLS estimates suffer from high spatial autocorrelation bias, while co-integrating spatial and temporal dependencies within a STAR model improves the precision of estimation. While the models produced a relatively modest accessibility premium on house prices, given traditional importance of private cars coupled with high income levels in the case study area, it would take a generational shift to make a significant impact on house prices as the area becomes more desirable due to reduced traffic congestion/travel time.

Impact of Transit-Oriented Development on Residential Property Values around Urban Rail Stations

Few previous studies have linked transit-oriented development (TOD) patterns and property values at the station level in the Chinese context. Using Shanghai as a case study, we obtained 21,094 transaction records within the 800 m radius catchment areas of 280 urban rail stations from a local property agency. A performance-based TOD indicator framework was established to capture built-environment features for density, diversity, and design dimensions. Using open-source geospatial data, we generated a series of TOD indicators for each station catchment area and further developed a composite TOD index with information entropy weighting. The results of multilevel regression models showed that within urban rail station catchment areas, residential properties with higher TOD levels were positively associated with higher value. In addition, increasing pedestrian and bike accessibility and integrating diversified urban functions around stations could create more value for nearby residential properties.

Impacts of online shopping convenience and physical retail proximity on housing prices in Shenzhen, 2016–2018

Retail activities are important parts of urban life, but limited empirical research has been conducted to address the changing impacts of physical retail activities and online shopping activities under current growth of e-commerce. This study investigates the impacts of online shopping convenience and physical retail proximity on residential property price in Shenzhen by conducting hedonic price models. The analysis results indicate that home buyers are willing to pay more for better online shopping convenience. By contrast, proximity to physical retail businesses, such as convenience stores and shopping malls, adversely affects nearby residential property price. This analysis gives market players, housing management practitioners and urban planner insights into how online shopping convenience is highly valued by home buyers, and guidance to a more desirable and efficient community design and urban planning in the modern society.

Housing demolition and property tax delinquency: Evidence from Detroit

ABSTRACT The purpose of this article is to evaluate the degree to which the demolition of low-quality structures affects property tax compliance in Detroit. During the real estate crisis, the rate of property tax delinquency in the city exceeded 50%. The demolition of dilapidated structures could lead to improvements in tax compliance in two ways. The first is through an amenity effect: removal of blighted structures improves the neighborhood and thus may increase the likelihood that neighbors pay their property taxes. The second is via the existence of a peer effect in property tax compliance decisions. We use a 6-year panel database to examine the degree to which demolitions affect nearby residential property tax delinquency. Even though we are unable to disentangle the amenity and peer effects, our analysis shows that when a dilapidated property is demolished, tax delinquency within the neighborhood is reduced, providing evidence that demolitions improve tax compliance.

Effects of High-Voltage Overhead Power Lines (HVOPLs) on Residential Property Prices

Research findings on the effects of high-voltage overhead power lines on values of neighborhood properties remain inconclusive and inadequately explored. This study aims to investigate the effects of HVOPLs on market values and sale-prices of residential properties in the vicinity. The empirical results based on a hedonic price model show that HVOTLs impart a significant negative effect on nearby residential properties. Results show that affected properties are selling at a discount price compared to properties without the influence of HVOPLs. The market value of a residential unit located within physical distance of 300-meters of power-lines, and pylon, are on average, 34.2% and 18% lower than comparable properties, respectively. Furthermore, results suggest that it is the physical distance to HVOPL structures that accounts more for the value diminution compared to the visual impact of the structure. The results imply that the market value of properties adjacent to HVOPL corridors is reduced significantly. This discourages potential property buyers. The study contributes to the knowledge in two-ways: (i) it shows the greater impact of HVOPLs on property prices with a larger reduction in valuation than previous studies; and (ii) effects of the different visual impact of pylons compared with that of cables are clearly distinguished.

The external effects of inner‐city shopping centers: Evidence from the Netherlands

AbstractShopping center redevelopment is inevitable to remain attractive for consumers. In this paper, we investigate the external effects of shopping center redevelopment on nearby residential property prices. Using a difference‐in‐difference empirical framework, we find the redevelopment has positive external effects on nearby property prices. We find the price of a property located next to a redeveloped shopping center increases by 1.43% on average just after redevelopment. Our results indicate that these positive external effects wear off rather rapidly across space and over time. This suggests that shopping center redevelopment plays a substantial, but limited, role in combating neighborhood deprivation.

Sustainable valuation of urban green infrastructure: a case of evidence-based policy making from India

The case study demonstrates that indirect benefits of well-maintained urban parks/gardens and water bodies have positive effect on the residents of the city which is reflected in nearby residential property rates indicated by more willingness to pay (WTP) on the part of people willing to buy them. This behaviour was captured in residential plots' collector rate modification policy decision in Chandigarh city of India during 2016. This step led to generation of better revenue by the city administration, enabling more ploughing back of money towards creation/and maintenance of urban parks/gardens and water bodies (e.g., Sukhna Lake). Cases of such kinds are not common in developing countries and need to be encouraged for sustaining local civic authorities financially.

Assessing lead exposure sources at the property scale in Indianapolis

Background and Hypothesis: 
 Lead (Pb) was phased out of paint and gasoline over 40 years ago due to neurotoxicity in humans, but has persisted in soils and poses a legacy threat to many. The Indianapolis 46218 zip code has had >10% children exhibiting Pb poisoning. This zip code has had historically high soil Pb levels, and is undergoing redevelopment. We hypothesize that redevelopment will act to re-expose new populations of people to the legacy Pb present in the area. 
 Experimental Design or Project Methods: 
 We sampled 5 parks and 7 playgrounds. Stratified random sampling based on permit type was used to select properties from 25 issued and 25 closed permits from 527 identified demolition permits. Nearby residential properties were selected, with permission of residents. Samples were taken near the dripline of the house, front yard, and street, or from each quadrant at sites without houses. Samples were dried, crushed, sieved to 150 microns, and assessed using X-Ray Fluorescence. 
 Results: 
 Mean Pb levels from driplines (1026 ppm) were significantly higher than streets (p=0.001), parks (p=0.002), yards (p=0.001), and demolition sites (p=0.000). Pb concentrations for playgrounds had the lowest median lead levels (42 ppm), while dripline samples had the highest (289 ppm). The EPA standard for children’s play areas is 400 ppm. 
 Conclusion and Potential Impact: 
 While all samples from playgrounds were below 400 ppm, children are also likely playing at their homes, where no legislation effectively protects them from potential Pb poisoning and values were found above 400 ppm. An immediate outcome from this project is the education. Residents who agreed to testing (n=42) received results of the test and guidelines to prevent Pb poisoning. More work remains to ensure preventive rather than reactive strategies are employed to protect children’s health.

Sports Arenas, Teams and Property Values: Temporary and Permanent Shocks to Local Amenity Flows

Professional sports facilities and teams generate local amenity flows in cities that may affect property values. Previous research shows evidence of important positive and negative local amenity flows based on case studies of changes in residential property values in specific cities. We analyze changes in residential property values in Oklahoma City over a period, 2000 to 2016, where both temporary and permanent exogenous shocks to local sports-related amenities occurred. Results from hedonic price models and repeat sales regression models show that nearby residential property prices increased after the opening of a new arena and the arrival of a new, permanent NBA team in the city. The presence of a temporary NBA team visiting the city had a weaker impact.

Strip Clubs, “Secondary Effects” and Residential Property Prices

AbstractMunicipalities regulate sexually oriented businesses (SOBs) through the “secondary effects” doctrine, which justifies limiting First Amendment speech protections inside SOBs. Negative effects of SOBs on nearby neighborhood quality are a frequently cited secondary effect. Little empirical evidence exists that SOBs generate such negative externalities. If SOBs generate negative externalities, then nearby property prices should decrease when a strip club opens. We estimate regression models of housing prices to determine the effect of new clubs on nearby residential property prices in Seattle, exploiting the termination of a 17‐year moratorium on openings and find no evidence that strip clubs have “secondary effects.”

Evaluating acarological risk for exposure to Ixodes scapularis and Ixodes scapularis-borne pathogens in recreational and residential settings in Washington County, Minnesota

The distribution of I. scapularis, the tick vector of the bacteria that cause Lyme disease, has been expanding over the last two decades in the north-central United States in parallel with increasing incidence of human cases of Lyme disease in that region. However, assessments of residential risk for exposure to ticks are lacking from this region. Here, we measured the density of host-seeking I. scapularis nymphs in two suburban and two rural public recreational sites located in Washington County, Minnesota as well as in nearby residential properties. We sought to compare tick densities across land use types and to identify environmental factors that might impact nymphal density. We also assessed the prevalence of infection in the collected ticks with Lyme disease spirochetes (Borrelia burgdorferi sensu stricto, B. mayonii), and other I. scapularis-borne pathogens including B. miyamotoi, Babesia microti and Anaplasma phagocytophilum. Similar to studies from the eastern United States, on residential properties, I. scapularis nymphal densities were highest in the ecotonal areas between the forest edge and the lawn. Residences with the highest densities of nymphs were more likely to have a higher percentage of forest cover, log piles, and signs of deer on their property. In recreational areas, we found the highest nymphal densities both in the wooded areas next to trails as well as on mowed trails. Among the 303 host-seeking I. scapularis nymphs tested for pathogens, B. burgdorferi sensu stricto, A. phagocytophilum and B. miyamotoi were detected in 42 (13.8%), 14 (4.6%), and 2 (0.6%) nymphs, respectively.

Brownfields Remediation: Impact on Local Residential Property Tax Revenue

The US Environmental Protection Agency (EPA) Brownfields Program provides grants to assess and clean up brownfields. There are few studies that estimate tax revenue impacts from cleanup beyond those generated directly from within the remediated site’s property lines. This study estimates the increased residential property tax revenue attributable to brownfields cleanup at 48 sites remediated between 2004 and 2011 under the EPA Brownfields Cleanup Grants Program. Findings from a previous study of a 5% to 15.2% property value increase following cleanup at these sites are applied to the assessed values of nearby residential properties along with local tax laws, assessment ratios, and rates to estimate tax revenue gained as a result of brownfields cleanup. The estimated increase in residential property tax revenue for a single tax year from remediating 48 brownfields properties was between $29 million and $97 million (2014 USD).

Professional sports facilities, teams and property values: Evidence from NBA team departures

Professional sports teams and facilities can generate negative or positive amenities to be capitalized into nearby property prices. We investigate the effect of the departure of two National Basketball Association teams in Seattle and Charlotte on nearby residential property values. Both arenas continued to operate after the teams left, so these departures represents a natural experiment to identify the net effects of a sports team separately from the effect of a facility and other events that take place in the facility. Results from a repeat sale regression model and hedonic price model indicate that the departure of the teams was associated with excess appreciation of condo prices near Key Arena and single family home prices near the Charlotte Arena, suggesting that the teams generated disamenities in these markets.