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The Value of Land Use Patterns and Preservation Policies

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  • Heintzelman Martin D

    (Clarkson University)

Abstract

In many communities, land-use and open-space preservation have become important concerns. Using a large dataset containing every home sale in the state of Massachusetts over 8 years, this paper simultaneously measures the impact of the mix of land-uses in the immediate neighborhood of a home on property values and the impact of a locally-implemented program, the Community Preservation Act (CPA), which provides funds for local open-space and historic preservation as well as affordable housing. I exploit the panel nature of the dataset to conduct a difference-in-differences analysis using local as well as house level fixed effects to overcome omitted variables bias. My results indicate that, on average, passage of the CPA reduces property values by about 1.5% in Massachusetts towns. However, when I allow the CPA effect to differ by county, I find some heterogeneity -- it increases property values in some communities and reduces them in others. Variation in local spending priorities appears to have little impact on property values or the effect of the CPA. Finally, I find that cropland and pasture, as well as low-density residential development, are the most preferred local land-uses, and that homes are more expensive as one increases distance to highways and active rail lines.

Suggested Citation

  • Heintzelman Martin D, 2010. "The Value of Land Use Patterns and Preservation Policies," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-26, May.
  • Handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:39
    DOI: 10.2202/1935-1682.2484
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    References listed on IDEAS

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    1. Martin D. Heintzelman, 2010. "Measuring the Property-Value Effects of Local Land Use and Preservation Referenda," Land Economics, University of Wisconsin Press, vol. 86(1), pages 22-47.
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    Cited by:

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    2. Tuttle, Carrie M. & Heintzelman, Martin D., 2013. "The Value of Forever Wild: An Economic Analysis of Land Use in the Adirondacks," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 42(1), pages 1-20, April.
    3. Hyun No Kim & Ik-Chang Choi, 2018. "The Economic Impact of Government Policy on Market Prices of Low-Fat Pork in South Korea: A Quasi-Experimental Hedonic Price Approach," Sustainability, MDPI, vol. 10(3), pages 1-16, March.
    4. Peter Abelson & Roselyne Joyeux & Stephane Mahuteau, 2013. "Modelling House Prices across Sydney," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 46(3), pages 269-285, September.
    5. Cao, Y. & Swallow, B. & Qiu, F., 2018. "Does Municipal Development Policy Affect Property Values: A Quasi-Experimental Hedonic Model Approach in Alberta, Canada," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277044, International Association of Agricultural Economists.
    6. Martin Heintzelman & Jason Altieri, 2013. "Historic Preservation: Preserving Value?," The Journal of Real Estate Finance and Economics, Springer, vol. 46(3), pages 543-563, April.

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