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Effects of Zoning on Residential Option Value

Author

Listed:
  • Jonathan Young

    (Department of Economics, West Virginia University)

Abstract

Knowing more precisely how zoning affects housing value would allow policy-makers to improve long-term policy decisions. Previous studies have concluded that local zoning regulations affect residential option value. These studies, however, do not specify the magnitude of the effect for varying zoning types. This study quantifies zoning’s effect on residential option value for specific types of zoning using a hedonic regression model of housing prices. The study utilizes information on housing characteristics and sales prices for a cross-section of houses in Monongalia County, West Virginia. The research develops two models to differentiate between zoning effects on developed versus undeveloped properties. The research finds that R1 and R1a zoning regulations – the most common types of residential zoning in Monongalia County – significantly impact housing value.

Suggested Citation

  • Jonathan Young, 2004. "Effects of Zoning on Residential Option Value," Working Papers Working Paper 2004-12, Regional Research Institute, West Virginia University.
    • Handle: RePEc:rri:wpaper:2004wp12
    as

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    File URL: https://researchrepository.wvu.edu/rri_pubs/122/
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    References listed on IDEAS

    as
    1. Jeremy R. Groves & Eric Helland, 2002. "Zoning and the Distribution of Location Rents: An Empirical Analysis of Harris County, Texas," Land Economics, University of Wisconsin Press, vol. 78(1), pages 28-44.
    2. J. Phillips & E. Goodstein, 2000. "Growth management and housing prices: the case of Portland, Oregon," Contemporary Economic Policy, Western Economic Association International, vol. 18(3), pages 334-344, July.
    3. Turnbull, Geoffrey K., 1991. "A comparative dynamic analysis of zoning in a growing city," Journal of Urban Economics, Elsevier, vol. 29(2), pages 235-248, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    zoning; housing value; policy; regional development; West Virginia;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location
    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets

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