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Growth management and housing prices: the case of Portland, Oregon


  • J. Phillips
  • E. Goodstein


Portland, Oregon, is well known for its relatively unique urban growth boundary (UGB), a very tight form of zoning designed to control sprawl. The UGB has recently been criticized for raising housing prices. From a theoretical perspective, the UGB will put upward pressure on land and thus housing prices, but the magnitude of this effect is uncertain. Increasing density should substitute for higher land prices, partially offsetting any reduction in the supply of housing. In addition, at any given moment, speculative factors influence housing price levels in bull markets such as the one Portland has been experiencing. This article presents an econometric analysis assessing these conflicting effects. We find the UGB has created upward pressure on housing prices, but the effect is relatively small in magnitude. Copyright 2000 Western Economic Association International.

Suggested Citation

  • J. Phillips & E. Goodstein, 2000. "Growth management and housing prices: the case of Portland, Oregon," Contemporary Economic Policy, Western Economic Association International, vol. 18(3), pages 334-344, July.
  • Handle: RePEc:bla:coecpo:v:18:y:2000:i:3:p:334-344

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    References listed on IDEAS

    1. Rose, Louis A., 1989. "Topographical constraints and urban land supply indexes," Journal of Urban Economics, Elsevier, vol. 26(3), pages 335-347, November.
    2. Joe Peek & James A. Wilcox, 1991. "The Measurement and Determinants of Single-Family House Prices," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 19(3), pages 353-382.
    3. Michael J. Potepan, 1996. "Explaining Intermetropolitan Variation in Housing Prices, Rents and Land Prices," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 24(2), pages 219-245.
    4. Ozanne, Larry & Thibodeau, Thomas, 1983. "Explaining metropolitan housing price differences," Journal of Urban Economics, Elsevier, vol. 13(1), pages 51-66, January.
    5. Case, Karl E & Shiller, Robert J, 1989. "The Efficiency of the Market for Single-Family Homes," American Economic Review, American Economic Association, vol. 79(1), pages 125-137, March.
    6. Karl E. Case & Robert J. Shiller, 1990. "Forecasting Prices and Excess Returns in the Housing Market," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 18(3), pages 253-273.
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    Cited by:

    1. Cheshire, Paul & Sheppard, Stephen, 2002. "The welfare economics of land use planning," Journal of Urban Economics, Elsevier, vol. 52(2), pages 242-269, September.
    2. Robert W. Wassmer & Michelle C. Baass, 2006. "Does a more centralized urban form raise housing prices?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 25(2), pages 439-462.
    3. ., 2014. "Planning for a housing crisis: or the alchemy by which we turn houses into gold," Chapters,in: Urban Economics and Urban Policy, chapter 4, pages 79-103 Edward Elgar Publishing.
    4. Clark, Thomas A., 2013. "Metropolitan density, energy efficiency and carbon emissions: Multi-attribute tradeoffs and their policy implications," Energy Policy, Elsevier, vol. 53(C), pages 413-428.
    5. Paul C. Cheshire & Christian A.L. Hilber, 2008. "Office Space Supply Restrictions in Britain: The Political Economy of Market Revenge," Economic Journal, Royal Economic Society, vol. 118(529), pages 185-221, June.
    6. Richard J. Vyn, 2015. "The Effect of Agricultural Zoning on Rural Residential Property Values: An Application to Ontario's Greenbelt," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 63(3), pages 281-307, September.
    7. Paul Cheshire, 2008. "Reflections on the nature and policy implications of planning restrictions on housing supply. Discussion of 'Planning policy, planning practice, and housing supply' by Kate Barker," Oxford Review of Economic Policy, Oxford University Press, vol. 24(1), pages 50-58, spring.
    8. Paul Cheshire, 2009. "Urban Containment, Housing Affordability and Price Stability - Irreconcilable Goals," SERC Policy Papers 004, Spatial Economics Research Centre, LSE.
    9. Samuel M. Otterstrom, 2015. "Income Migration and Home Price Trajectories in the United States," International Real Estate Review, Asian Real Estate Society, vol. 18(2), pages 277-302.
    10. repec:rri:wpaper:200412 is not listed on IDEAS
    11. Marin V. Geshkov & Joseph S. DeSalvo, 2012. "The Effect Of Land-Use Controls On The Spatial Size Of U.S. Urbanized Areas," Journal of Regional Science, Wiley Blackwell, vol. 52(4), pages 648-675, October.
    12. Dempsey, Judith A. & Plantinga, Andrew J., 2013. "How well do urban growth boundaries contain development? Results for Oregon using a difference-in-difference estimator," Regional Science and Urban Economics, Elsevier, vol. 43(6), pages 996-1007.
    13. Quigley, John M. & Rosenthal, Larry A., 2005. "The Effects of Land-Use Regulation on the Price of Housing: What Do We Know? What Can We Learn?," Berkeley Program on Housing and Urban Policy, Working Paper Series qt90m9g90w, Berkeley Program on Housing and Urban Policy.
    14. Cheshire, Paul & Sheppard, Stephen, 2004. "Land markets and land market regulation: progress towards understanding," Regional Science and Urban Economics, Elsevier, vol. 34(6), pages 619-637, November.
    15. Cheung, Ron & Ihlanfeldt, Keith & Mayock, Thomas, 2009. "The regulatory tax and house price appreciation in Florida," Journal of Housing Economics, Elsevier, vol. 18(1), pages 34-48, March.
    16. Cho, Seong-Hoon & Chen, Zhuo & Yen, Steven T., 2008. "Urban Growth Boundary and Housing Prices: The Case of Knox County, Tennessee," The Review of Regional Studies, Southern Regional Science Association, vol. 38(1), pages 29-44.
    17. Jonathan Young, 2004. "Effects of Zoning on Residential Option Value," Working Papers Working Paper 2004-12, Regional Research Institute, West Virginia University.
    18. Grout, Cyrus A. & Jaeger, William K. & Plantinga, Andrew J., 2011. "Land-use regulations and property values in Portland, Oregon: A regression discontinuity design approach," Regional Science and Urban Economics, Elsevier, vol. 41(2), pages 98-107, March.
    19. Wu, JunJie & Cho, Seong-Hoon, 2007. "The effect of local land use regulations on urban development in the Western United States," Regional Science and Urban Economics, Elsevier, vol. 37(1), pages 69-86, January.

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