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Impacts of property taxation on residential real estate development

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  • England, Richard W.
  • Zhao, Min Qiang
  • Huang, Ju-Chin

Abstract

Decisions about residential lot size and square footage are influenced by a variety of determinants ranging from zoning regulations to neighborhood characteristics. Our theoretical analysis suggests that the property tax rate could also affect residential lot sizes and the sizes of newly constructed houses. Using descriptions for over 36 thousand houses built in New Hampshire between 1985 and 2006, we find empirical evidence that higher property taxes are indeed associated with both smaller lots and smaller houses. On average, higher property tax rates are associated with more additional living space per newly developed acre. These effects are modest in magnitude, however.

Suggested Citation

  • England, Richard W. & Zhao, Min Qiang & Huang, Ju-Chin, 2013. "Impacts of property taxation on residential real estate development," Journal of Housing Economics, Elsevier, vol. 22(1), pages 45-53.
    • Handle: RePEc:eee:jhouse:v:22:y:2013:i:1:p:45-53
    DOI: 10.1016/j.jhe.2012.11.002
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    3. Elvia J. Meléndez-Ackerman & Christopher J. Nytch & Luis E. Santiago-Acevedo & Julio C. Verdejo-Ortiz & Raúl Santiago-Bartolomei & Luis E. Ramos-Santiago & Tischa A. Muñoz-Erickson, 2016. "Synthesis of Household Yard Area Dynamics in the City of San Juan Using Multi-Scalar Social-Ecological Perspectives," Sustainability, MDPI, vol. 8(5), pages 1-21, May.
    4. Taranu, Victoria & Verbeeck, Griet, 2022. "Property tax as a policy against urban sprawl," Land Use Policy, Elsevier, vol. 122(C).
    5. Murray, Cameron & Hermans, Jesse Benjamin, 2019. "Land value is a progressive and efficient property tax base: Evidence from Victoria," OSF Preprints mxg3j, Center for Open Science.

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