Site Density Restrictions: Measurement and Empirical Analysis

Land Use Policy, 2013

Beijing has a unique spatial pattern that is characterized by an inverted U-shape building height curve and geometrically developed transportation network (rings of highways and axial roads). The inverted U-shape curve of building heights is mainly the outcome of building height restrictions in inner city for historical preservation. This paper estimates the economic costs of the building height restrictions by using land development data. Through comparing land development without building height restrictions and simulations, we show that the economic costs are substantial. The impacts of the building height restrictions include land price decrease by up to 60%, housing output decrease by up to 70%, and land investment decrease by 85%. To accommodate the loss of housing output, the city edge has to expand, causing urban sprawl (given all other things equal). In order to offset building space reduction, housing prices rise by 20% and the city edge expands by 12%. Finally, induced travel costs resulting from urban sprawl and low density caused by building height restrictions may not be trivial.

Cities

Real estate development is a complex speculative endeavor and developer firms take a variety of forms throughout the world. State run development companies are relatively common and China is no exception. State Owned Enterprises (SOEs) have played a major role in China's transition to a market-based real estate sector, yet we know relatively little about the housing they build relative to private companies currently. To assess how their performance differs from private companies, we use a comprehensive set of georeferenced housing transactions, joined with remote sensing data and data on neighborhood amenities and transportation infrastructure, to analyze the dynamics of the Chengdu housing market from 2004 to 2011. We observe a drop in the variation in housing price and size, as well as a growing premium for larger units that we connect to changes in government regulations. Importantly, we find that units developed by SOE sell at a discount of roughly 7%. To explain this discount, we draw on literature and examine pricing strategy, difficult to measure quality elements, preferred treatment by local governments, and efforts to fulfill social goals related to housing provision. The study outlines directions for future research and we recommend the Chinese government formalize the relationship between SOEs in national housing policy to facilitate the production of lower-cost housing in a more consistent and equitable manner.

Chinese Geographical Science, 2001

China began to introduce market principles and establish price mechanism to better manage land and improve land use efficiency in the late 1980s. Since then, land m.arkets begin to emerge. A benchmark land price system, providing guidelines for land use rights selling and transferring, was established in order to overcome lack of market data and experiences in land transaction. The benchmark prices of land use rights are determined by land use, land use density (floor-land ratio), land gravies, land improvement, and tenant resettlement costs. This paper first conducts a formal analysis based on modem urban economic theory. The formal model provides a theoretical foundation in which the benchmark land price system is assessed and evaluated in terms of land use and urban development. The paper then concludes that the benchmark price system has two theoretical problems. One is associated with the fact that floor-land ratio plays an important role in land price determination whereas the theory suggests the other way around. That is, floor-land ratio depends on land prices. The other problem is that the benchmark land price system does not provide adequate room for the substitution between land and capital inputs. The substitution is a key in achieving land use efficiency in land markets and urban development process. It is concluded that the practice of the benchmark land price system is at odd with reforms that aim to introduce market principles and mechanism to guide resource uses. Therefore, it is recommended that further land policy reform should be taken. KEY WORDS: urban economics; land development; land prices; urban land use; floor-land ratio CLC number: F293.2 Document code: A Biography: DING Cheng-ri(1963 -), male, a native of Jilin Province, Ph. D., associate professor. His research interests include urban economies, housing, real estate and land development, quantitative research, neighborhood and local economic development, and spatial analysis and GIS.

Social Science Research Network, 2008

A key asset that is important in international markets is real estate-raw land and developed properties. Also, real estate can clearly have difference local rules for investment and transactions based upon bankruptcy protection, appraisal standards, lending standards, taxation and planning processes across countries. This can be particularly true when assessing a developing country. In this research, we assess the relative pricing behavior for land in Beijing China. We see this as important for three core reasons. First, China has a strong growth economy but is still in many ways an undeveloped country and thus we do not have significant data about asset pricing behavior there. Second, China has not traditionally had a market based land and property transfer system. Thus, it is interesting to assess how prices are determined relative to typical market expectations. Third, we have extensive evidence on pricing behavior in the USA and Europe but little such evidence on China. Are the same variables important in Land pricing in China and are there other unique local variables. For example, there have been twenty-two articles published in core journals on Chinese land and only two provide empirical estimates of value attributes and none of there are as extensive as our study. Thus, we consider a large data set of land prices in Beijing China and assess the relative pricing behavior. Our key results are that pricing behavior in general follows the traditional expected variables as determined by size, planning use, location and other neighborhood characteristics. However, we also find that land prices are associated with buyer characteristics; for example, foreign investors pay less than local investors.

International Real Estate Review, 2006

Cities, 2016

This paper analyzes how the newly introduced land pricing system affects urban land productivity in China, taking post-land-reform Beijing as an example. China has been developing its urban land market by building an effective pricing system. This study indicates that the effects of such pricing system on urban land productivity have evolved with the progress of land reform. It is only since 2004, when land granting by negotiation was at last totally prohibited for profit-oriented developments, that the land pricing system has started to positively and significantly improve urban land productivity; the land pricing system also promotes more productive urban land usage by stimulating more intensive investment and better business management.

using-co sts-land-use-regulatio ns/ Cre d it: wo o d le ywo nd e rwo rks (Cre ative Co mmo ns BY) In desirable cities, property owners and developers influence tighter land use regulations, which can lead to substantially higher urban and housing costs. In the US and elsewhere, zoning policies and other land use regulations are now widespread. Christian Hilber and Frédéric Robert-Nicoud look at the reasons behind these policies, finding that, driven by lobbying from developers and property owners, places that are more developed tend to adopt tighter land use regulations. With land regulations operating as a form of 'shadow tax', of over 50 per cent of housing value in some cities, land regulations may now have become too much of a barrier to development in urban areas. Land use regulations vary tremendously in shape and scope across space and have become more widespread and stringent over time. Although land use regulations have a long history dating back to the 17 th century at least, they were initially pro-growth. Only one century ago, hardly any country regulated land use systematically in a restrictive manner. T he f irst comprehensive zoning law in the United States, f or example, dates back to 1916 (in New York). In contrast, nowadays all modern states regulate land use intensively in an overwhelmingly restrictive way. Land use planning policies can, in principle, raise welf are by correcting market f ailures. Recent evidence, however, casts doubt on this proposition and suggests that such regulations have strong adverse net ef f ects: Turner, Haughwout, and van der Klaauw (2012) estimate the net cost of land use regulations as a proportion of land value to reach a hef ty 38% in their sample of residential plot transactions across the United States. An earlier study by Cheshire and Sheppard (2002) estimates the net costs of land use planning policies in the UK to amount to as much as 3.9% of annual household incomes. So we are talking about big numbers.

SSRN Electronic Journal, 2019

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A special feature of China's housing market is land use rights in the form of land leasehold contracts granted by the government. We consider an equilibrium model in which a representative developer may choose to redevelop existing centrally located housing or to develop new housing at the periphery of the city. We show that as the city grows, the land leasehold system results in the city center being developed less intensely and more land being used on the outskirts of the city when compared to a fee simple environment. Thus, cities in China are likely to be relatively more spread out, with city centers relatively older than would be the case with "fee simple" ownership. Our model suggests that excess residential land use is about 6 percent. In addition, compared with the ownership case, housing supply will grow more quickly in the near future, but more slowly later on during the transition of the Chinese economy. Parallel to the supply growth pattern, equilibrium price grows relative slowly in the near future, but more quickly later on. While we focus on residential uses, we believe our model can be applied to other land uses.

Environment and Planning B: Planning and Design, 2007