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The effect of bus rapid transit on local home prices

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  • Beaudoin, Justin
  • Tyndall, Justin

Abstract

Bus Rapid Transit (BRT) systems have become increasingly common in US cities. BRT stations provide a local amenity by improving transportation options for local residents, but may also represent a local nuisance due to noise or displacement of other road users. We estimate whether BRT is priced into local real estate by studying a recently opened BRT project in Vancouver, Washington. We use a difference-in-difference method with both hedonic and repeat sales estimators to test for a price effect. We estimate a 5%–7% price premium for homes located within a 20 min walk of a BRT station. Overall, BRT generated new real estate value that exceeded the project’s construction costs by a factor of six. We discuss how government could leverage future residential property value increases to fund construction of BRT projects.

Suggested Citation

  • Beaudoin, Justin & Tyndall, Justin, 2023. "The effect of bus rapid transit on local home prices," Research in Transportation Economics, Elsevier, vol. 102(C).
    • Handle: RePEc:eee:retrec:v:102:y:2023:i:c:s0739885923001105
    DOI: 10.1016/j.retrec.2023.101370
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    More about this item

    Keywords

    Transportation; Transit; Bus Rapid Transit; Real estate;
    All these keywords.

    JEL classification:

    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
    • R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning

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