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Proud of, but too close: the negative externalities of a new sports stadium in an urban residential area

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Abstract

Sports facilities have been found to generate positive externalities over negative ones, so empirical studies report residential property prices increase near these facilities. This study investigates the effect of a new baseball stadium on housing values using a case which is deemed to induce negative externalities overwhelmingly due to the case-specific characteristics. Employing a difference-in-differences (DID) approach on data reflecting over 17,000 apartment transactions, this study finds a significant price depreciation within 2 km from a new stadium by up to approximately 7% after its opening. The spatial variation in price changes presents a clear distance decaying pattern, implying that the price effects are closely associated with negative externalities such as light pollution, noise, and traffic congestion. All of which would obviously fade away being further from the origin, the stadium.

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Notes

  1. A 2 km threshold in Ahlfeldt and Maennig (2009), a 2.5 mile threshold in Coates and Humphreys (2006), a 3 mile threshold in Kavetsos (2012)and Tu (2005), and a 5 km threshold in Ahlfeldt and Kavetsos (2014).

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Acknowledgements

The present research was supported by the research fund of Dankook university in 2020 and has no conflict of interest.

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  1. School of Urban Planning and Real Estate Studies, Dankook University, Yongin, South Korea

    Dongwoo Hyun

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  1. Dongwoo Hyun
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Correspondence to Dongwoo Hyun.

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Hyun, D. Proud of, but too close: the negative externalities of a new sports stadium in an urban residential area. Ann Reg Sci 68, 615–633 (2022). https://doi.org/10.1007/s00168-021-01095-6

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