The impact of crime on apartment prices: evidence of Stockholm, Sweden
This study uses data over 9600 apartment sales in Stockholm, Sweden, to assess the impact of crime on property prices. Using two-stage analysis, the study first employs hedonic pricing modelling to estimate the impact of crime controlling for other factors (property and neighbourhood characteristics). Then, the willingness to pay is calculated for a certain property having as a function crime together with other house and area attributes. GIS is used to combine apartment sales by co-ordinates with offences, land use characteristics and demographic and socio-economic data of the population. The novelty of this research is threefold. First, it explores a set of land use attributes created by spatial techniques in GIS in combination with detailed geographical data in hedonic pricing modelling. Second, the effect of crime in neighboring zones at one place can be measured by incorporating spatial lagged variables of offence rates into the model. Third, the study provides evidence of the impact of crime on housing prices from a capital city from a welfare state country, something otherwise lacking in the international literature. Our results indicate that total crime rates showed no effect on apartment prices but when the offences were break down by types, violence, residential burglary, vandalism and robbery had individually a significant effect on property values.
|Date of creation:||Sep 2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.ersa.org
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Richard Voith, 1991.
"Changing capitalization of CBD-oriented transportation systems: evidence from Philadelphia, 1970-1988,"
91-19, Federal Reserve Bank of Philadelphia.
- Voith Richard, 1993. "Changing Capitalization of CBD-Oriented Transportation Systems: Evidence from Philadelphia, 1970-1988," Journal of Urban Economics, Elsevier, vol. 33(3), pages 361-376, May.
- Steve Gibbons, 2003.
"The Costs of Urban Property Crime,"
CEP Discussion Papers
dp0574, Centre for Economic Performance, LSE.
- Darla K Munroe, 2007. "Exploring the determinants of spatial pattern in residential land markets: amenities and disamenities in Charlotte, NC, USA," Environment and Planning B: Planning and Design, Pion Ltd, London, vol. 34(2), pages 336-354, March.
- Michael P. Murray, 2006. "Avoiding Invalid Instruments and Coping with Weak Instruments," Journal of Economic Perspectives, American Economic Association, vol. 20(4), pages 111-132, Fall.
- Bourassa, Steven C. & Hoesli, Martin & Peng, Vincent S., 2003.
"Do housing submarkets really matter?,"
Journal of Housing Economics,
Elsevier, vol. 12(1), pages 12-28, March.
- Halvorsen, Robert & Pollakowski, Henry O., 1981. "Choice of functional form for hedonic price equations," Journal of Urban Economics, Elsevier, vol. 10(1), pages 37-49, July.
- Leigh Linden & Jonah E. Rockoff, 2008. "Estimates of the Impact of Crime Risk on Property Values from Megan's Laws," American Economic Review, American Economic Association, vol. 98(3), pages 1103-27, June.
- Marko Kryvobokov & Mats Wilhelmsson, 2007. "Analysing location attributes with a hedonic model for apartment prices in Donetsk, Ukraine," International Journal of Strategic Property Management, Taylor & Francis Journals, vol. 11(3), pages 157-178, June.
- Mats Wilhelmsson, 2000. "The Impact of Traffic Noise on the Values of Single-family Houses," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 43(6), pages 799-815.
- Thaler, Richard, 1978. "A note on the value of crime control: Evidence from the property market," Journal of Urban Economics, Elsevier, vol. 5(1), pages 137-145, January.
- Allen Lynch & David Rasmussen, 2001. "Measuring the impact of crime on house prices," Applied Economics, Taylor & Francis Journals, vol. 33(15), pages 1981-1989.
When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa10p1026. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gunther Maier)
If references are entirely missing, you can add them using this form.