A Spatial Autocorrelation Approach for Examining the Effects of Urban Greenspace on Residential Property Values
- 2.3k Downloads
This paper presents spatially explicit analyses of the greenspace contribution to residential property values in a hedonic model. The paper utilizes data from the housing market near downtown Los Angeles. We first used a standard hedonic model to estimate greenspace effects. Because the residuals were spatially autocorrelated, we implemented a spatial lag model as indicated by specification tests. Our results show that neighborhood greenspace at the immediate vicinity of houses has a significant impact on house prices even after controlling for spatial autocorrelation. The different estimation results from non-spatial and spatial models provide useful bounds for the greenspace effect. Greening of inner city areas may provide a valuable policy instrument for elevating depressed housing markets in those areas.
KeywordsHousing value Urban greenspace Hedonic pricing model Spatial dependence
We would like to thank the anonymous reviewers for their comments that helped improve the paper. All omissions or errors remain our own.
- Anderson, L. M., Cordell, H. K. (1985). Residential property values improved by landscaping with trees. Southern Journal of Applied Forestry, 9, 162–166.Google Scholar
- Anselin, L. (1988a). Spatial econometrics: Methods and models. Dordrecht, Netherlands: Kluwer Aceademic.Google Scholar
- Anselin, L. (1988b). Lagrange Multiplier test diagnostics for spatial dependence and spatial heterogeneity. Geographical Analysis, 20, 1–17.Google Scholar
- Anselin L., Rey, S. J. (1991). Properties of tests for spatial dependence in linear regression models. Geographical Analysis, 23, 110–131.Google Scholar
- Bailey, T. C., Gatrell, A. C. (1995). Interactive spatial data analysis. Harlow Essex, England: Pearson Education Limited.Google Scholar
- Beron, K. J., Hanson, Y., Murdoch, J. C., Thayer, M. A. (2004). Hedonic price function and spatial dependence: Implications for the demand for urban air quality. In L. Anselin, R. J. G. M. Florax, S. J. Rey (Eds.), Advances in spatial econometrics: Methodology, tools and application (pp. 267–281). Berlin: Springer.Google Scholar
- Bin, O., & Polasky, S. (2003). Valuing inland and coastal wetlands in a rural setting using parametric and semi-parametric hedonic models. Department of Economics, East Carolina University. http://www.ecu.edu/econ/wp/03/ecu0305.pdf. Accessed March 15, 2008.
- Bockstael, N., Bell, K. (1998). Land-use patterns and water quality: The effect of differential land management controls. In R. Just, S. Netanyahu (Eds.), Conflict and cooperation on trans-boundary water resources (pp. 169–192). Boston, MA: Kluwer Academic Publishers.Google Scholar
- Cliff, A., Ord, J. (1973). Spatial autocorrelation. London: Pion.Google Scholar
- Crompton, J. L. (2001). The impact of parks on property values: a review of the empirical evidence. Journal of Leisure Research, 33, 1–31.Google Scholar
- Crompton, J. L. (2004). The proximate principle: The impact of parks and open space on property values and the property tax base. Ashburn, Virginia: National Recreation and Park Association.Google Scholar
- Des Rosiers, F., Thériault, M., Kestens, Y., Villeneuve, P. (2002). Landscaping and house values: an empirical investigation. Journal of Real Estate Research, 23, 139–161.Google Scholar
- Diamond, N. K., Standiford, R. B., Passof, P. C., LeBlanc, J. (1987). Oak trees have varied effect on land values. California Agriculture, 41, 4–6.Google Scholar
- Dombrow, J., Rodriguez, M., Sirmans, C. F. (2000). The market value of mature trees in single-family housing markets. The Appraisal Journal, 68, 39–43.Google Scholar
- Dwyer, J. F., McPherson, E. G., Schroeder, H. W., Rowntree, R. W. (1992). Assessing benefits and costs of the urban forest. Journal of Arboriculture, 18, 227–234.Google Scholar
- Florax, R. J. G. M., de Graaff, T. (2004). The performance of diagnostic tests for spatial dependence in linear regression models: A meta-analysis of simulation studies. In L. Anselin, R. J. G. M. Florax, S. J. Rey (Eds.), Advances in spatial econometrics: Methodology, tools, and applications (pp. 29–65). Berlin: Springer.Google Scholar
- Gabriel, S., Wolch, J. (1984). Spillover effects of human service facilities in a racially segmented housing market. Journal of Urban Economics, 111, –12.Google Scholar
- Geoghegan, J., Lynch, L., Bucholtz, S. (2003). Capitalization of open space into housing values and the residential property tax revenue impacts of agricultural easement programs. Agricultural and Resource Economics Review, 32, 33–45.Google Scholar
- Harnik, P. (2000). Inside city parks. Washington, D. C.: Trust for Public Land and the Urban Land Institute.Google Scholar
- Herrick, C. (1939). The effects of parks upon land real estate values. The Planning Journal, 5, 89–94.Google Scholar
- Lindsey, G., Man, J., Payton, S., Dickson, K. (2004). Property values, recreation values and urban greenways. Journal of Parks and Recreation Administration, 22, 69–90.Google Scholar
- Longcore, T., Li, C., & Wilson, J. (2003). Nature’s services in a dense urban neighborhood. Working Paper. University of Southern California, Center for Sustainable Cities.Google Scholar
- Luley, C. J. (1998). The greening of urban air. Forum for Applied Research and Public Policy, 13, 33–35.Google Scholar
- Miron, J. (1984). Spatial autocorrelation in regression analysis: A beginner’s guide. In G. L. Gaile, C. J. Willmott (Eds.), Spatial statistics and models (pp. 201–222). Boston: D. Reidel.Google Scholar
- Morales, D., Micha, F. R., Weber, R. C. (1983). Two methods of evaluating trees on residential site. Journal of Arboriculture, 9, 21–24.Google Scholar
- Nicholls, S. (2002). Does open space pay? Measuring the impacts of green spaces on property values and the property tax base Ph.D. dissertation. College Station, Texas: Department of Recreation, Park and Tourism Sciences.Google Scholar
- Nicholls, S. (2004). Measuring the impacts of parks on property values. Parks & Recreation Magazine, March.Google Scholar
- Odland, J. (1988). Spatial autocorrelation. Newbury Park, California: SAGE.Google Scholar
- Ready, R., & Abdalla, C. (2003). The Impact of open space and potential local disamenities on residential property values in Berks County, Pennsylvania. University Park, PA: Department of Agricultural Economics and Rural Sociology, Pennsylvania State University. http://landuse.aers.psu.edu/study/BerksLandUseShort.pdf. Accessed March 15, 2008.
- Scott, K. I., Simpson, J. R., McPherson, E. G. (1999). Effects of tree cover on parking lot microclimate and vehicle emissions. Journal of Arboriculture, 25, 129–142.Google Scholar
- Standiford, R. B., Vreeland, J., & Tietje, B. (2001). California’s hardwood rangelands: Production and conservation values. Berkley, California: University of California Integrated Hardwood Range Management Program, UC Berkley. http://danr.ucop.edu/ihrmp/oak89.htm. Accessed March 15, 2008.
- Wolch, J., Wilson, J., & Fehrenbach, J. (2002). Parks and park funding in Los Angeles: An equity mapping analysis. Los Angeles, CA: University of Southern California Center for Sustainable Cities. http://www.usc.edu/dept/geography/ESPE/documents/publications_parks.pdf#. Accessed March 15, 2008.