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House Price Effects of Commercial Entry: Event Study Evidence from London

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  • Wanqi Liu
  • Rong Zhao

Abstract

Restaurants, cafes, and other commercial amenities are among the most visible markers of neighborhood change, yet whether their arrival drives house price appreciation or merely follows rising demand remains an open empirical question. This study investigates the causal effect of commercial entry on residential property values in Greater London. Exploiting the staggered timing of 21,189 restaurant and cafe openings across 4,835 Lower Layer Super Output Areas (LSOAs)--identified through Energy Performance Certificate records--we implement an event study design with LSOA-specific linear trends that passes the parallel trends test (F = 1.04, p = 0.384). We find that house prices rise monotonically after commercial entry, reaching +4.1% at four years post-treatment (p

Suggested Citation

  • Wanqi Liu & Rong Zhao, 2026. "House Price Effects of Commercial Entry: Event Study Evidence from London," Papers 2603.03260, arXiv.org.
    • Handle: RePEc:arx:papers:2603.03260
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