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The Impact of Mixed Land Use on Residential Property Values

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  • Hans R.A. Koster

    (VU University Amsterdam)

  • Jan Rouwendal

    (VU University Amsterdam)

Abstract

This discussion paper led to a publication in the Journal of Regional Science (2012). Vol. 52(5), pages 733-761. Contemporary European urban planning policies aim to mix land uses in compact neighbourhoods. It is presumed that mixing land uses yields socio-economic benefits and therefore has a positive effect on housing values. In this paper, we investigate the impact of mixed land use on housing values using semiparametric estimation techniques. We demonstrate that a diverse neighbourhood is positively valued by households. There are various land use types which positively affect house prices, e.g. business services and leisure. Land uses that are incompatible with residential land use are, among others, manufacturing and wholesale. It appears that households are willing to pay up to 6 percent more for a house in a mixed neighbourhood than for an otherwise comparable house in a monofunctional area. We also show that there is substantial heterogeneity in willingness to pay for mixed land use. For example, apartment occupiers are willing to pay almost 25 percent more for diversity than households living in detached housing.

Suggested Citation

  • Hans R.A. Koster & Jan Rouwendal, 2010. "The Impact of Mixed Land Use on Residential Property Values," Tinbergen Institute Discussion Papers 10-105/3, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20100105
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    7. Ammar Malik & Andrew Crooks & Hilton Root & Melanie Swartz, 2015. "Exploring Creativity and Urban Development with Agent-Based Modeling," Journal of Artificial Societies and Social Simulation, Journal of Artificial Societies and Social Simulation, vol. 18(2), pages 1-12.
    8. Liu, Jixiang & Xiao, Longzhu, 2023. "Non-linear relationships between built environment and commuting duration of migrants and locals," Journal of Transport Geography, Elsevier, vol. 106(C).
    9. Hong Jiang & Weiting Xiong, 2024. "The Impact of Land-Use Mix on Technological Innovation: Evidence from a Grid-Cell-Level Analysis of Shanghai, China," Land, MDPI, vol. 13(4), pages 1-17, April.
    10. Hanbing Yang & Meichen Fu & Li Wang & Feng Tang, 2021. "Mixed Land Use Evaluation and Its Impact on Housing Prices in Beijing Based on Multi-Source Big Data," Land, MDPI, vol. 10(10), pages 1-21, October.
    11. Jieyuan Zhu & Huiting Lu & Tianchen Zheng & Yuejing Rong & Chenxing Wang & Wen Zhang & Yan Yan & Lina Tang, 2020. "Vitality of Urban Parks and Its Influencing Factors from the Perspective of Recreational Service Supply, Demand, and Spatial Links," IJERPH, MDPI, vol. 17(5), pages 1-17, March.
    12. Hans R. A. Koster, 2013. "Rocketing Rents The magnitude and attenuation of agglomeration economies in the commercial property market," SERC Discussion Papers 0125, Centre for Economic Performance, LSE.
    13. Yunes Almansoub & Ming Zhong & Asif Raza & Muhammad Safdar & Abdelghani Dahou & Mohammed A. A. Al-qaness, 2022. "Exploring the Effects of Transportation Supply on Mixed Land-Use at the Parcel Level," Land, MDPI, vol. 11(6), pages 1-28, May.
    14. Peter Gordon & Wendell Cox, 2012. "Cities In Western Europe and The United States: Do Policy Differences Matter?," Working Paper 8956, USC Lusk Center for Real Estate.
    15. Danya Kim & Jangik Jin, 2019. "The Effect of Land Use on Housing Price and Rent: Empirical Evidence of Job Accessibility and Mixed Land Use," Sustainability, MDPI, vol. 11(3), pages 1-18, February.
    16. Zhijiao Qin & Yan Yu & Dianfeng Liu, 2019. "The Effect of HOPSCA on Residential Property Values: Exploratory Findings from Wuhan, China," Sustainability, MDPI, vol. 11(2), pages 1-18, January.
    17. Mike Langen & Erdal Aydin & Piet Eichholtz & Nils Kok, 2022. "Getting high or getting low? the external effects of coffeeshops on house prices," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 50(2), pages 565-592, June.
    18. Bo-sin Tang & Kwan To Wong, 2020. "Assessing externality: Successive event studies on market impacts of new housing development on an old residential neighbourhood," Environment and Planning B, , vol. 47(1), pages 156-173, January.
    19. Peter Gordon & Wendell Cox, 2012. "Cities in Western Europe and the United States: do policy differences matter?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 48(2), pages 565-594, April.
    20. Song Zhang & Mark Duijn & Arno J. Vlist, 2023. "Tenant Mix and Retail Rents in High Street Shopping Districts," The Journal of Real Estate Finance and Economics, Springer, vol. 67(1), pages 72-107, July.
    21. Brady P. Horn & Aakrit Joshi & Johanna Catherine Maclean, 2019. "Substance Use Disorder Treatment Centers and Property Values," NBER Working Papers 25427, National Bureau of Economic Research, Inc.
    22. Terrence M. Clauretie & Herman Li, 2019. "Land Values: Size Matters," The Journal of Real Estate Finance and Economics, Springer, vol. 58(1), pages 80-110, January.
    23. Song Zhang & Mark van Duijn & Arno J. van der Vlist, 2020. "The external effects of inner‐city shopping centers: Evidence from the Netherlands," Journal of Regional Science, Wiley Blackwell, vol. 60(4), pages 583-611, September.
    24. Hee Jin Yang & Jihoon Song & Mack Joong Choi, 2016. "Measuring the Externality Effects of Commercial Land Use on Residential Land Value: A Case Study of Seoul," Sustainability, MDPI, vol. 8(5), pages 1-15, April.
    25. Wouter Vermeulen & Jan Rouwendal, 2014. "On The Value Of Foregone Open Space In Sprawling Cities," Journal of Regional Science, Wiley Blackwell, vol. 54(1), pages 61-69, January.

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    Keywords

    Mixed land use; diversity; hedonic price analysis; semiparametric estimation;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
    • R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

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