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The Commodity Effects of Decommodification: Community Land Trusts and Neighborhood Property Values

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  • Katharine Nelson
  • James DeFilippis
  • Richard Kruger
  • Olivia Williams
  • Joseph Pierce
  • Deborah Martin
  • Azadeh Hadizadeh Esfahani

Abstract

This article explores the impacts of community land trust (CLT) properties on the real estate prices of nearby homes through a case study of a relatively large CLT in Minneapolis, Minnesota. We use hedonic regression and a difference-in-difference estimation with spatial error correction to measure price effects. The number of developments citywide is insufficient to yield significant results. However, we find evidence that clustering CLTs stemmed the decline in sales prices during the foreclosure crisis. The introduction of the first nearby CLT had no measurable price impact, but each additional CLT was associated with a 5% higher sales price in North Minneapolis, and 3% higher in Central Minneapolis. In the postrecession period, we estimate that the introduction of CLTs in North Minneapolis was associated with a 10.9% increase in nearby sales prices. These results suggest that, contrary to common assumptions, price effects are strongest when affordable properties are spatially clustered.

Suggested Citation

  • Katharine Nelson & James DeFilippis & Richard Kruger & Olivia Williams & Joseph Pierce & Deborah Martin & Azadeh Hadizadeh Esfahani, 2020. "The Commodity Effects of Decommodification: Community Land Trusts and Neighborhood Property Values," Housing Policy Debate, Taylor & Francis Journals, vol. 30(5), pages 823-842, September.
    • Handle: RePEc:taf:houspd:v:30:y:2020:i:5:p:823-842
    DOI: 10.1080/10511482.2020.1768573
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    Cited by:

    1. Parker, Madeleine E.G. MPA & Chapple, Karen PhD & Park, Yuju MCP, 2023. "Strategies to Preserve Transit-accessible Affordable Housing in Southern California," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt4g71n0ks, Institute of Transportation Studies, UC Berkeley.

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