Urban form and the value of amenities

Aims and method:

Explores the relationships between social and economic value and urban form across six British cities. The study draws on a variety of publicly available data at ward level and utilises linear regression analysis to establish and understand correlations between the key dependant (depreciation or value) and independent variables (aspects of urban form).

Key findings:

· The social and economic value placed on the presence of greenery relates to its quality and not necessarily to its quantity or proximity.

· The sort of generally high quality greenery found in London can add 10.6% to the value of housing, but in Liverpool where there is an abundance of often low quality green space, homes located closer than average to such space suffered a 7.2% decrease

· Areas of high population and large areas of unbuilt space are less valuable and often associated with deprived communities

· The heritage premium is greater than the new build one. In London a home closer than average to a listed building is worth 10.3% more on average. The new build premium is a fifth of this.

· Areas gentrifying in London are typified by their high proportion of pre-1900 housing stock. In London, also, walkable, well-connected street based networks carry a premium

· Diversity in form, land use and transport provision carries a premium in all the cities studied.

Reference:

Boys Smith, N., Venerandi, A. & Toms, K. (2017) Beyond Location, A Study into the Links Between Specific Components of the Built Environment and Value, London, Create Streets

http://dev.createstreets.com/wp-content/uploads/2017/09/Beyond-Location-summary.pdf

Valuing sustainable urbanism

Aims and method:

This research was designed to define and then to measure the physical characteristics of ‘sustainable urbanism’ (mixed use, streets based, walkable, environmental and socially sustainable development) and to look at the economic characteristics of sustainable urbanism in terms of present total development value and how that differs from other forms of value generation and residential value growth in conventional projects. Three sustainable urbanism schemes were identified, and potential differences to suitable comparators assessed. The average value across property types of each scheme was derived and discussed at a series of focus groups.

Key findings:

· Building some or all of the features of sustainable urbanism can enhance total development value in all markets

· This includes locations of low demand (Fairford Leys, Aylesbury experienced a 46% uplift in values per hectare), high demand (Poundbury, Dorchester saw a 18% uplift), and in high supply (Crown Street, Glasgow, a 30% uplift, despite oversupply)

· Sustainable urbanism provides the greatest value enhancement where development is taking place in a low demand market.

Reference:

Dittmar, H., Mayhew, G., Hulme, J., & Smallwood, C. (2007). Valuing Sustainable Urbanism: A Report Measuring and Valuing New Approaches to Residentally Led Mixed Use Growth, The Prince’s Foundation For the Built Environment.

http://www.ads.org.uk/wp-content/uploads/0707vsureport_0.pdf

The value of residential street layout

Aims and method:

Provides empirical evidence from Halifax, Nova Scotia, confirming the view that the type of neighbourhood street can affect home values. The study identifies two categories of streets-the cul-de-sac and the grid-and measures their impacts on home value. Regression analysis was used to examine the Compural Data Base of Turner and Drake Limited, with analysis of 268 home sales between 1976 and 1984.

Key findings:

· The hypothesis that the cul-de-sac would attract premium values was supported by the study.

· The cul-de-sac generated a 29 percent price premium over the grid street pattern

Reference:

Asabere, P. (1990) The Value of a Neighborhood Street with Reference to the Cul-de-Sac, `journal of Real Estate and Finance Economics, 3: 185-193

https://link.springer.com/article/10.1007/BF00216591

Mixed land uses and housing value

Aims and method:

Analyses the impact on the prices of single family houses when mixed land uses are included in neighbourhoods. Utilises a range of quantitative measures of mixed land uses through Geographic Information System (GIS) data and computes these measures for various neighbourhoods in Washington County, Oregon (USA). Measures were incorporated into a hedonic price analysis.

Key findings:

· Mixing certain types of land uses with single family residential housing has the effect of increasing residential property values.

· Housing prices increase with their proximity to (or with an increasing amount of) public parks and neighbourhood commercial land uses (neighbourhood stores).

· An additional premium exists when a neighbourhood store is situated within pedestrian walkable distance.

· Housing prices are higher in neighbourhoods dominated by single-family residential land uses, where non-residential land uses are evenly distributed, and where more service jobs are available.

· Housing prices tend to fall with proximity to multi-family residential units.

Reference:

Song, Y., & Knaap, G. J. (2004). Measuring the effects of mixed land uses on housing values. Regional Science and Urban Economics, 34(6), 663-680.

http://www.sciencedirect.com/science/article/pii/S016604620400016X

The value of housing design and layout

Aims and method:

Assesses the extent to which design impacts on the value of residential development. Different types of design in housing and housing layout are examined to understand their impact on the price of new housing developments. The research selected eight examples of completed developments and compared them in four matched pairs at different locations around the South East of England. This eliminated the impact of regional economies and the differences between regional housing markets when making comparisons.

Key findings:

· Higher density does not decrease value per square foot, but there is a critical balance to be struck by the developer in maintaining unit values while increasing density.

· In three out of four cases there was an enhanced added value by the innovative nature of the designs over their conventional counterparts, of 15, 10.3 and 7.5 per cent respectively.

· Sites with relatively high residual values, in relation to their matched pairs, appeared to have high proportions of public open space in relation to the overall size of the site.

· There are a series of factors, including the built form, which creates a sense of place. It is possible to create a sense of place, and therefore a new type of location on a piece of land, by employing urban design principles. These new places may be more desirable, and therefore more valuable, than their neighbours.

Reference:

FPDSavills Research (2003) The value of housing design and layout, Commission for Architecture and the Built Environment

http://webarchive.nationalarchives.gov.uk/20110118095356/http:/www.cabe.org.uk/publications/the-value-of-housing-design-and-layout

Market appreciation and neo-traditional housing

Aims and method:

Studies market appreciation for clustered housing (a neo-traditional approach that clusters the same number of units on smaller lots and leaves the remaining space as permanently open community space) compared with conventional housing. The percentage change in the selling price of two comparable housing schemes in New England (USA) examined over a ten year period.

Key findings:

· The purchase of the average home in a neo-traditional development would have yielded a higher rate of return on investment (by some 12.7%) than one in a conventional development.

· Even with lot sizes up to 50% smaller, the value of the neo-traditional scheme exceeds the conventional suburban one.

Reference:

Lacy, J. (1990). An examination of market appreciation for clustered housing with permanent open space. Department of Landscape Architecture and Regional Planning, University of Massachusetts, Amherst, 78.

www.ehsa.info/ehsa.info/Echo_Hill.../OpenSpace%20%26%20RE%20Value.pdf

Valuing proximity to iconic (residential) design

Aims and method:

Investigates the willingness of homebuyers to pay for co-location with iconic architecture. Oak Park, Illinois (USA) with its 24 Frank Lloyd Wright houses was examined. The study utilised a hedonic price model that included several independent variables, various structural characteristics, distance to amenities, proximity to other historic landmark buildings and location in historic districts that served to control for a variety of factors affecting the price of a home.

Key findings:

· A premium on the price paid per land unit is achieved of up 8.5% for homes within 50m of a Wright home, and about 5% within 50-250m.

· Beyond this threshold evidence for positive effects is weak at best.

Reference:

Ahlfeldt, G., & Mastro, A. (2012). Valuing iconic design: Frank Lloyd Wright architecture in Oak Park, Illinois. Housing Studies, 27(8), 1079-1099.

http://www.tandfonline.com/doi/abs/10.1080/02673037.2012.728575

and

http://www.spatialeconomics.ac.uk/textonly/SERC/publications/download/sercdp0084.pdf

Connectivity to rail and property value

Aims and method:

Examines the impact on property values of proximity to good public transport as represented by a rail station. Presents the results through hedonic price model of the Atlanta region (USA) that incorporates externalities such as the potential for increased neighbourhood crime.

Key findings:

· Rail stations have a direct effect on the value of single-family homes. These effects are found to vary with neighbourhood income, distance to the CBD centre, and whether the nearest station has a parking lot.

· In the basic model, properties within a quarter of a mile from a rail station are found to sell for 19% less than properties beyond three miles from a station. However, properties that are between one and three miles from a station have a significantly higher value compared to those farther away.

· The results suggest that houses that are very close to stations are affected by negative externalities (e.g. higher crime associated with the station), but those at an intermediate distance are beyond the externality effects and benefit from the transportation access provided by the stations

Reference:

Bowes, D. R., & Ihlanfeldt, K. R. (2001). Identifying the impacts of rail transit stations on residential property values. Journal of Urban Economics, 50(1), 1-25.

http://www.sciencedirect.com/science/article/pii/S0094119001922144

The market for smarter growth

Aims and method:

Studies perceptions of the market for pedestrian- and transit-oriented development forms in the USA. Utilises a national survey of 676 developers from across the country.

Key findings:

· Overall, respondents perceive considerable market interest in alternative (pedestrian-

and transit-oriented) development forms, and believe that there is inadequate supply of such alternatives relative to market demand.

· Across the country a market of at least 10% of consumers of new housing exists, with a potential market of up to 25% in some places

Reference:

Levine, J., & Inam, A. (2004). The market for transportation-land use integration: Do developers want smarter growth than regulations allow?. Transportation, 31(4), 409-427.

https://link.springer.com/article/10.1023/B:PORT.0000037086.33893.9f

Real estate value and quality design in residential properties

Aims and method:

Estimates the impact of quality design attributes on real estate value through empirical investigation of the owner-occupied multifamily residential sector In Belfast (UK). The research is based on spatiotemporal modelling using a unique data-set of 424 Belfast City Centre apartments sold during the period 2000–2008.

Key findings:

· Urban scale aspects of quality such as connectivity and vitality associated with building density add to real estate value.

· At the building level, quality features highly valued by home buyers include appropriateness of material quality, fenestration and massing in relation to the surroundings.

· These key criteria are considered to have a significant visual perception compared to more complex concepts such as identity, material choice and overall condition

Reference:

Nase, I., Berry, J., & Adair, A. (2016). Impact of quality-led design on real estate value: a spatiotemporal analysis of city centre apartments. Journal of Property Research, 33(4), 309-331.

http://www.tandfonline.com/doi/abs/10.1080/09599916.2016.1258588

Commercial land use and residential value

Aims and method:

Investigates how commercial land use affect residential land values. Using data gathered in Seoul (Korea), the authors pay attention to two particular aspects of commercial land use: spatial concentration and neighbourhood scale. Spatial concentration is determined by the number of commercial employees present in the buffer zone around an individual residential parcel.

Key findings:

· Increasing commercial activity around residences is related to higher residential land values

· Beyond a threshold level, land values decrease because convenience is offset by excessive congestion or noise

· Overall the value of mixed use development is supported

Reference:

Yang, H. J., Song, J., & Choi, M. J. (2016). Measuring the Externality Effects of Commercial Land Use on Residential Land Value: A Case Study of Seoul. Sustainability, 8(5), 432.

http://www.mdpi.com/2071-1050/8/5/432

Elevated freeway removal, traffic impacts and property prices

Aims and method:

Investigates the neighbourhood, traffic, and housing price impacts of replacing elevated freeways with surface boulevards in two corridors of San Francisco in California, USA. A mix of methods is used including informant interviews, literature review, and statistical analyses. A matched-pair approach was employed to examine demographic and land-use attributes prior to and after freeway removal based on block-level census statistics and land-use projection. To examine impacts on property values, hedonic models were estimated using time-series data on residential sales prices, housing and neighbourhood attributes, and measures of proximity to transportation corridors.

Key findings:

· Replacement of elevated freeways causes traffic to redistribute across the network without raising congestion

· Depressed house prices rebounded in the years following the work, with the biggest before-and-after differential for residences within 0.25 miles of the boulevard.

· Freeway-to-boulevard conversions, a form of urban reprioritisation that gives more emphasis to neighbourhood quality and less to automobility, have yielded net positive benefits without seriously sacrificing transportation performance

Reference:

Cervero, R., Kang, J. & Shively, K. (2009). From elevated freeways to surface boulevards: neighborhood and housing price impacts in San Francisco, Journal of Urbanism: International Research on Placemaking and Urban Sustainability, 2(1), 31-50

http://www.tandfonline.com/doi/pdf/10.1080/17549170902833899?needAccess=true

Streets and residential value

Aims and method:

Evaluates how the interactions between variously scaled spatial layouts and land-use systems affect the valuation of residential properties and the segmentation of housing markets, using Shanghai as its main case study. This is achieved through the indexing of streets within the context of their neighbouring spatial and functional context and street accessibility measures. The assessments are based on graph representations of built environments that factor in non-Euclidean street plans and layouts that result in street coefficient maps that also show spatial constraints based on road segment connectivity.

Key findings:

• Places where properties are located on streets with higher levels of angular closeness, smaller values of angular betweenness and longer angular distance to nearby land-uses at larger scales will be priced more highly
• Land-diversity at the pedestrian level is not a preference in housing submarkets located in developed city centres
• The development of walkable areas could be an alternative way to decelerate the growth of housing prices in Chinese cities.

Reference:

Shen, Y., Karimi, K. (2017) "The economic value of streets: mix-scale spatio-functional interaction and housing price patterns". Applied Geography, 79, 187-202

https://www.sciencedirect.com/science/article/abs/pii/S0143622816308293