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Does a more centralized urban form raise housing prices?


  • Robert W. Wassmer

    (California State University, Sacramento)

  • Michelle C. Baass

    (California Legislative Analyst's Office, Sacramento)


This paper examines the relationship between various quantitative measures of urban centralization and urban housing prices through the use of a 2000 data set from the 452 Census designated urbanized areas in the United States. An empirical study of this type is necessary because: (1) the theoretical influence of creating more centralized urban areas-or what many would consider less “sprawl”-on what people pay for housing is indeterminate, (2) now popular “Smart Growth” policies advocate more centralized urban areas, and (3) some have argued that a cost of this centralization is an increase in the price of homes. After controlling for differences across United States urbanized areas in residents' economic status and demographics, number and type of households, climate, household growth, nonresidential land uses, and the structural characteristics of houses, we find that a more centralized area exhibits a lower median home value and percentage of homes in an upper-end price category. Therefore, we offer no evidence to support the contention that a successful effort to further centralize an urban area raises the price of homes in that urban area. © 2006 by the Association for Public Policy Analysis and Management

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  • 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.
  • Handle: RePEc:wly:jpamgt:v:25:y:2006:i:2:p:439-462
    DOI: 10.1002/pam.20180

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    References listed on IDEAS

    1. Edward L. Glaeser, Jed Kolko, and Albert Saiz, 2001. "Consumer city," Journal of Economic Geography, Oxford University Press, vol. 1(1), pages 27-50, January.
    2. Ozanne, Larry & Thibodeau, Thomas, 1983. "Explaining metropolitan housing price differences," Journal of Urban Economics, Elsevier, vol. 13(1), pages 51-66, January.
    3. Stephen Malpezzi, 1994. "Housing Prices, Externalities, and Regulation in U.S. Metropolitan Areas," Wisconsin-Madison CULER working papers 94-08, University of Wisconsin Center for Urban Land Economic Research.
    4. 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.
    5. Song, Yan & Knaap, Gerrit-Jan, 2003. "New urbanism and housing values: a disaggregate assessment," Journal of Urban Economics, Elsevier, vol. 54(2), pages 218-238, September.
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