Housing Market

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Impact fees are charges assessed by counties and municipalities to developers to recover the part of the cost of infrastructure improvements that future tax revenues will not cover. Impact fees are an increasingly common tool that municipalities around the country use to pay for new schools, sewers, roads, parks, and other public amenities. In the case of utility infrastructure (e.g., water mains, electrical lines, and the like), the assessment of fees is straightforward-usually fees are determined per engineers' cost estimates. The impacts of new development on municipal services and amenities are more difficult to estimate: some municipalities use complex formulas to estimate the likely impact of one new home on the cost of providing and maintaining parks, schools, roads, and police and fire protection services. Many of these formulas are based on land valuations; these valuations are themselves often controversial. Sometimes developers are required to pay additional charges to cover some set of costs that the municipality deems important. These charges may be meant to cover unforeseen impacts on municipal government budgets or they may be destined to cover a neighborhood improvement that city planners want. The ambiguity of the appropriate level of impact fees suggests several important issues for housing development policy. These issues include rent-seeking (unrestrained budget maximization by municipal politicians), subsidization of existing households at the expense of new entrants to the housing market, possible exclusionary practices toward minorities and the poor, and equity concerns regarding the payment for and distribution of benefits. Impact fees are a relatively new form of taxation that is hidden from housing consumers. Since impact fees involve restrictions upon property sales and development rights, several municipal fee structures have been challenged in court as "takings," i.e. unconstitutional limitations on the use and 1 This research was made possible by a generous grant from the Heartland Institute.

This powerful new theoretical approach to analyzing urban housing problems and the policies designed to rectify them will be a vital resource for urban planners, developers, policymakers, and economists. The search for the roots of serious urban housing problems such as homelessness, abandonment, rent burdens, slums, and gentrification has traditionally focused on the poorest sector

This paper studies the effect of a newly completed highway extension on home prices in the surrounding area. We analyze non-linearities in both the effect of distance from the highway and the effect of time relative to the completion of the road segment. While previous studies of the effects of nearby amenities on property and land values have focused on either cross-sectional spatial or temporal patterns, the joint analysis of the two dimensions has not been thoroughly investigated. We use home sale data from a period of 11 years centered around the completion of a new highway extension in metropolitan Los Angeles. We combine a standard hedonic model with a spline regression technique to allow for non-linear variations of the effect along the temporal and spatial dimensions. Our empirical results show that the maximum home price appreciation caused by the new highway extension occurs at moderate distances from the highway after it is completed. Lower price increases for this period are observed for homes sold closer to the highway or much further away. This price pattern gradually fades away in the years following the construction completion. A similar, although weaker, price pattern is also observed in the first years of the construction period. There is no statistically significant distance dependency in the 2 years in our sample prior to the beginning of the construction. This indicates that the housing market is not fully efficient as the information about the impending construction of the highway is not immediately incorporated into sales prices.

In this paper we examine the predictability power of the long term risk premium over housing prices in the U.S. for a period of 19 years (1991-2009). For reasons that are cited clearly in the text, the interest rate risk premium is preferred over the yield spread. Under a probit framework, we investigate whether the recent housing prices bust could have been predicted. We employ adaptive expectations for the formation of the agents' shortterm interest rate expectations. The ability to forecast such price changes is of great importance to investors and analysts of the housing market and for the design of financial institutions' mortgage policy in a more prudential path.

The PIDS Discussion Paper Series constitutes studies that are preliminary and subject to further revisions. They are being circulated in a limited number of copies only for purposes of soliciting comments and suggestions for further refinements. The studies under the Series are unedited and unreviewed. The views and opinions expressed are those of the author(s) and do not necessarily reflect those of the Institute. Not for quotation without permission from the author(s) and the Institute.

A number of commentators believe that a potential solution to housing af- fordability is available through large scale release of newly subdivided land on the urban periphery. The argument follows that releasing more land increases supply and, through market forces, leads to lower new land and house prices. This will, in turn, lead to improved affordability within the stock of

The urban housing market of China has been transformed since the 1980s from a centrally-planned to a free-market system. This study aimed to (1) investigate the position of outdoor environmental quality in house-buyers' preferences; (2) assess monetary values attributed to environmental externalities by the hedonic pricing method (HPM); and (3) test the applicability of HPM in China. The study area was Guangzhou, the major city of south China with a booming real-estate market. A questionnaire survey was conducted with households in new residences sold in 2004. The main buying motives were improving living quarters and floor area. Security concerns and a preference for high-rise buildings were somewhat unexpected. Good outdoor environment, including green space provision, proximity to parks, and views of green space and water, carried significant hedonic values. Differences between the submarkets of old and new towns were found; new town households expected apartments in high-rise blocks, exclusive residential land use, and views of green space, while old town households preferred proximity to shopping areas and workplaces, green space within the development and proximity to nearby parks. The findings could help to fine tune the developing housing market to match supply with demand in quality terms. Values accorded to environmental attributes could justify funding for urban green spaces and nature conservation. The study verified the applicability of HPM to the housing context in China.

As housing costs have risen in the U.S. and federal subsidies for affordable housing programs have declined, inclusionary zoning (IZ) has become an increasingly popular local policy for producing low-income housing without direct public subsidy. The structure of IZ policies can vary in a number of ways; consequently, there is not yet a consensus about what policies constitute "true" inclusionary zoning. In this paper we compare the ways in which IZ programs have been structured in three regions in which it is relatively widespread and long-standing. Our results demonstrate that IZ programs are highly complex and exhibit considerable variation in their structures and outcomes. In the San Francisco Bay Area, IZ programs tend to be mandatory and apply broadly across locations and structure types, but attempt to soften potential negative impacts with cost offsets and alternatives to on-site construction. In the Washington DC area, most IZ programs are also mandatory, but have broader exemptions for small developments and low-density housing types. IZ programs in the Suburban Boston area exhibit the most withinregion heterogeneity. In this area, IZ is more likely to be voluntary and to apply only to a narrow range of developments, such as multifamily or age-restricted housing, or within certain zoning districts. The amount of affordable housing produced under IZ varies considerably, both within and across the regions. The flexibility of IZ allows planners to create a program that accommodates local policy goals, housing market conditions and political circumstances.

The ghost towns of the American West are both intriguing historical artifacts and reflections of unique economic forces at work. In this study we develop linked labor and housing market models balancing the wages, rents, and local amenities of isolated boomtown sites to better understand the sources of such communities' dramatic cycles. High variance boomtowns provide a unique context for investment in housing and other foundational infrastructure, leading directly to the unusually transient local development patterns seen in ghost town settings. We use Colorado-based case studies to illustrate the relevance of the model. Comparisons with more modern rural settings in Appalachia and the Midwest suggest that the model provides a framework to better understand the process of rural decline more generally.

The empirical research on housing market in India is scarce due to the paucity of information. The monograph on “A Study of Residential Housing Demand in India” is the outcome of a Study conducted by the National Institute of Bank Management (NIBM) for National Housing Bank (NHB) and partially addresses advice of Reserve Bank of India to NHB on studying the housing and real estate sector. This study provides exhaustive empirical research and detailed analysis (both micro and macro level) of current status and future growth potential of housing industry in India, its back-ward and forward linkages, financing structure and nature of underlying risk.

Thomas Palley argues that the causes of the †œGreat Recession†are not primarily to be found in the asset bubble that was allowed to inflate in the housing market and in the financial sector. The bubbles actually reflect the longer-term basis for stagnation that originate in the macro-economic structure of the US. He presents two major dimensions of these structural problems. The first problem is the entrenchment of a †œneoliberal†growth model that is hegemonic in the minds of politicians and the economics ...

Copenhagen today appears to be a resurgent city and city region. It came back to life in the mid-1990s and, until recently, has shown marked growth in key variables such as jobs, income and inhabitants, primarily as a result of the rise and spatial dynamics of its service-and knowledge-based economy. Its resurgence is also evident in the central municipalities that 20 years ago struggled with the repercussions of a long-term urban crisis. Financially, the central city was almost doomed in the late 1980s and early 1990s, and the city of Copenhagen was close to bankruptcy. Central-city development was characterized by a set of eroding processes that included de-industrialization, suburbanization, high unemployment rates, high welfare costs, an outdated housing market, strong segregation and various other factors. Copenhagen city and its city region have now been revitalized and today are a strong national centre of economic growth. Although one can catch glimpses of the crisis in key variables, urban turn remains strong; for instance, up to now, rising unemployment has been seen mainly outside the large urban areas in Denmark. However, the housing-market bubble has burst and other signs of crisis have been appearing since as early as 2006. Nevertheless, the city is far removed from the gloomy days of the late 1980s and early 1990s. The rise of the Copenhagen city region Copenhagen has been revived in the past two decades following the severe crisis of the 1970s and 1980s. Today the city is a strong national growth centre that is dominated by the rise of the new economy in terms of a strong service-and knowledge-based economy, a growing entertainment scene and a rise in creative industries. In this essay we outline the main features of the crisis of the 1980s and highlight the major components of urban resurgence in order to contextualize the current crisis within the long-term transformation of Copenhagen city and its city region. We distinguish here between the central city of Copenhagen and the Copenhagen city region: the former is made up of two central municipalities-Copenhagen (with approximately 500,000 inhabitants) and Frederiksberg (with approximately 100,000 inhabitants)-which cover one third of the total population of the city region; the latter includes suburbia and the outer city. The 1980s: crisis and doom in the central city In the 1970s and 1980s, the central city of Copenhagen was characterized by a set of eroding processes. First, there was a process of continuous de-industrialization, which included the closure and downsizing of manufacturing firms as a result of the economic crisis and of spatial restructuring of manufacturing that took place in many European

Since owner-occupied housing is partly a financial asset, expectations of capital gain or loss play a role in housing demand. In recent years, some "hot" housing markets have exhibited an increase in demand when housing prices rise and a decrease when they fall, suggesting the presence of capital gains forces that outweigh the traditional neoclassical demand response associated with the standard consumer good. To explore whether this behavior is systematic, we estimate individual household housing demand equations for two large and geographically diverse metropolitan areas, San Francisco and Atlanta. The data base consists of forty nine Public Use Microdata Area samples. The econometric results indicate that own-housing demand is downward sloping in one market but upward sloping in the other. These disparate results are reconciled by showing that they are consistent with two different and explicit special case predictions of the same theoretical model of housing demand and reflect the differing relative strengths of a standard consumption good demand response and of an asset based capital gains effect.

The role of art and the artist has played a part in both of the main long-established theories of gentrification, looking respectively at 'culture' and 'capital' as key drivers. Cultural analyses of gentrification have identified the individual artist as an important agent in the initiation of gentrification processes in old working-class neighbourhoods. Alternative theorizations have recognized a second stage where capital follows the artist into gentrified localities, commodifying its cultural assets and displacing original artists/gentrifiers. The paper will argue that more recently a third key model of gentrification can be recognized where the main driver of gentrification is 'public policy' which seeks to use 'positive' gentrification as an engine of urban renaissance. This involves the use of public art and cultural facilities as a promoter of regeneration and associated gentrification.

Many studies have been sought to understand the volatility patterns of real estate, whereas the study of housing price volatility is relatively little. This study aims to examine the determinants of housing price volatility for 8 capital cities in Australia. This study utilises quarterly data of 8 capital cities in Australia from 1987:Q4 to 2007:Q4. An Exponential-Generalised Autoregressive Conditional Heteoskedasticity (EGARCH) model is employed to analyse the volatility series of housing prices. Its determinants are also investigated. The results show that the volatility clustering effects (ARCH effects) are found in many capital cities. The importance of estimating each individual city's EGARCH model is also demonstrated in which the determinants of housing volatility vary from a city to another city. These findings provide some important insights into the volatility of housing price.

Between June 1998 and March 2006, the price index of apartment houses in Seoul, Korea, more than doubled, while fundamentals such as GDP, wage, and population increased by less than 35%. This study examines the role of a rational speculative bubble in this price surge. We find that unobservable information explains part of the price volatility; and that a rational bubble proxy is a significant driver of prices. However, neither latent information nor rational bubble is enough to explain the recent housing price appreciation, even in conjunction with observable fundamentals.

Policies of urban containment are widely used in land-use planning and as a means of reducing urban sprawl and of preserving farmland. This paper reviews the current state of knowledge about the effects of urban-containment boundaries on house prices. It is concluded that urban containment programs do affect land prices, and that housing producers do not always respond to higher land prices by increasing the density of development. In relation to aggregate housing prices, the effects of urban containment policy depend on factors such as style of policy implementation, local housing markets, and pattern of land ownership. The demand side of the housing market may be a stronger determinant of prices than local urban containment policies. Nevertheless, it is concluded that local planners can play a significant role in relation to the severity of housing price inflation attributable to urban containment policies. r

The amenity value provided by urban green spaces, water bodies and good environmental quality is difficult to assess and incorporate into urban planning and development. Developers and governments in China hitherto have seldom objectively factored these attributes into property pricing and associated decisions. The hedonic pricing method offers an appropriate approach to gauge such external benefits which contribute to real-estate transaction prices. This study explored the impacts of key environmental elements with a bearing on residential housing value in Guangzhou, including window orientation, green-space view, floor height, proximity to wooded areas and water bodies, and exposure to traffic noise. Four large private housing estates composed of multi-storied blocks with similar design and price bracket, catering to the mass property market, were sampled. Transaction price data and structural attributes of 652 dwelling units were acquired directly from developers. Data on environmental attributes were collected in the field. Two functional hedonic pricing method models, linear and semi-log, were constructed. The semi-log model offered comparatively stronger explanatory power and more reliable estimation. High floor on the multi-storey tenement blocks contributed implicitly 9.2% to the selling price. View of green spaces and proximity to water bodies raised housing price, contributing notably at 7.1% and 13.2%, respectively. Windows with a southern orientation with or without complementary eastern or northern views added 1% to the price. Proximity to nearby wooded area without public access was not significant, expressing the pragmatic mindset in the hedonic behavior. Exposure to traffic noise did not influence willingness-to-pay, implying tolerance of the chronic environmental nuisance in the compact city. The study demonstrates that hedonic pricing method could be applied in the Chinese context with an increasingly expanding and privatized property market. It could inform the decisions of policy makers and property developers concerning land selling and buying, land conversion, property development, urban nature conservation, and design of ecological green-space networks.

The planning mechanisms particularly through development plan and development control and the market system as operated in the housing development process are among the factors that influenced the effectiveness of housing supply system. Previous literature has proven that there was a close interaction between the planning and the market system, particularly with regard to the structure, operation and outcomes of housing supply. Even in the situation of imperfection and failure of the housing market, it becomes a function of planning mechanisms to rectify the failure. In relation to the responsiveness of planning system in managing housing supply, besides focusing on meeting broad housing needs, it is important for the planning system to incorporate the elements of effective demand, housing choice and the market conditions in the housing planning process. This paper aims to clarify the relationship between the planning and the market system in the process of housing supply. It will also highlight the current issues of housing supply in Malaysia and discuss possible method of analysis to be used in evaluating the responsiveness of the planning system in managing housing supply.

Japanese housing price determination mechanisms are analyzed using the housing demand index of demographic factors proposed by Mankiw and Weil (Regional Science and Urban Economics, 1989, 19, 235-258). The distinctive feature of this paper is that we distinguish between the long-run and short-run effects using the notion of cointegration and an error correction model. We find a high price elasticity for long-run housing supply contrary to the U.S. results and conclude that the effect of the demographics on housing prices in Japan appears through a short-run adjustment process.

Land-use regulation is undertaken by units of local government and is notoriously hard to measure. This paper assembles and reports the results of five complementary and overlapping surveys of local regulation in the San Francisco Bay Area. We compile measures derived from surveys of public officials conducted in 1992 and 1998 and another completed in 2007. In addition, we survey the perceptions of regulation among developers and land-use intermediaries. A rich description and comparison of regulatory patterns is provided. The paper also investigates relationships among various measures of regulation and housing outcomes. We find, for example, that the entitlement process increases the cost of a new single family dwelling by almost $23,000 in the Bay Area. Moreover, the requirement of an additional review by governmental agents to gain approval of new developments is associated with a four-percent increase in the prices of existing owner-occupied housing.

Effective governance of residential development and housing markets poses difficult challenges for land regulators. In theory, excessive land restrictions limit the buildable supply, tilting construction toward lower densities and larger, more expensive homes. Often, local prerogative and regional need conflict, and policymakers must make tradeoffs carefully. When higher income incumbents control the political processes by which local planning and zoning decisions are made, regions can become less affordable as prices increase. Housing assistance programs meant to benefit lower income households could be frustrated by limits on density and other restrictions on the number and size of new units.

To be affordable, a house must be designed and constructed to last; an approach to building that embraces sustainability principles. Energy efficient construction is proven to reduce the long-term costs of owning a house; it also improves building durability by decreasing the probability of moisture-related problems. When homeowners spend less on energy bills, they can better budget for maintenance and repair costs, which will again ensure that their house has longevity. While energy efficiency may modestly increase the up front construction costs, it will ensure that a house built today demonstrates value and will be affordable in the future.

Against a backdrop of recent strong growth in the Saudi Arabian housing market, rising housing costs, and diminishing consumer disposal incomes, this study examines the housing preferences of low-income consumers in Saudi Arabia, with specific emphasis on their preferences for alternative dwelling types and tenure options, factors influencing their housing decisions, and how these vary across socio-demographic sub-segments of this population segment. Using data collected through a structured self-administered survey in the major urban areas of the country, we find that majority of respondents prefer the small house to duplex or apartment, and despite their limited incomes the majority prefer buying over renting. We also find a very strong relationship between tenure preferences and dwelling type, with respondents who prefer the small house or duplex overwhelmingly opting for the buying option, whilst respondents who choose apartments prefer the rental option. On importance of housing attributes, a factor analysis of 35 housing attributes included in the study produced 10 factors, of which financial considerations, private living space, and aesthetic aspects of the house rank as the top 3 important factors in the low-income consumers' housing decisions. The 3 least important factors are exterior space, street location, and proximity to relatives. The latter is a particularly interesting result, given the strong social and familial bonds in Saudi culture. On socio-demographic differences, only for importance interior layout, private living space, aesthetics, and exterior space do we find significant gender differences (females consider them more important than males). The implications of these results are discussed and an outline suggested for future research on housing preferences in this important market of the Arab Middle East.

This thesis is majorly focuses on the situation of the urban villages of Delhi. Urban villages have evolved and transformed over the period of time and still has intact culture and tradition of villages but developing themselves in the race of urbanization. The housing market in these urban villages of Delhi is attracting majority classes of people to find an accommodation in the city. They are hubs for students, newly migrated, single working males and females and labor class.
Urban villages plays very important role in the functioning of the city by providing the accommodation to the people of Delhi as well as migrating people. The density of urban villages is much higher than other colonies and gradually increasing. Urban villages covered the 38.3% land of the Delhi city but provide the accommodation to more than 60% of people.

In the face of an estimated one billion people living in inadequate housing conditions in developing countries the need for scaling up housing supply has become an urgent focus of policy debate. To this end the expansion of the role of the private markets has formed the central thesis of the ‘enabling strategy’ for developing the housing sector as a whole rather than relying on project based approaches such as sites and services and settlement upgrading programmes. Policy recommendations emanating from such a standpoint concentrate on adjustments to supply and demand through deregulation and institutional development of the land and housing markets in developing countries in order to overcome largely external constraints to a more efficient market mechanism. This conception of the enabling strategy, however, has been subject to much debate and criticism for its over-concentration on the private markets and exclusion of alternative/complementary modes of housing provision from seriou...

Over the past forty years, rent control has been a feature of housing in Ghana. This study focusses on the housing market in Kumasi, the second largest city in Ghana. We examine the characteristics of the rent control regime in force there, and assess the costs and benefits of rent control, on landlords and on tenants, and its effects on the housing stock.

In this paper we argue that a process of super-gentrification, similar to that first identified by Lees (2003 Urban Studies 40 2487 in Brooklyn Heights, New York City, is occurring in the already gentrified, inner London neighbourhood of Barnsbury. A new group of super wealthy professionals working in the City of London is slowly imposing its mark on this inner London housing market in a way that differentiates it and them both from traditional gentrifiers and from the traditional urban upper classes. We suggest that there is a close interaction between work in the newly globalizing industries of the financial services economy, elite forms of education, particularly Oxbridge, and residence in Barnsbury which is very different from other areas of gentrified inner London. key words super-gentrification London globalization global elites neighbourhood fixedness

Hong Kong has been faced with property market ups and downs for many reasons over the past 10 years or so. It once experienced shortages of housing supply, leading to prolonged escalating prices. This was followed by a downturn of housing prices since the end of 1997 and in the wake of the financial turmoil in Asia. Hong Kong people have been very concerned with the housing market situation, particularly housing prices, and consider that the problem needs to be addressed to prevent its recurrence in the future. The Hong Kong government uses its land-use planning system to address this ''market failure''. Also, such a system imposes constraints on land supply and development, through various means by altering the supply of housing land. As a result, the residential property has been affected, and so is the housing price.

The objective of this research is to determine the spatial variation in amenity values for both quantity and quality of green open space in the housing market. Variables related to size, proximity, spatial configuration, and species composition of open space are endogenized in the global and local models in a hedonic price framework. Empirical evidence shows that amenities of different features of open space vary according to the degree of urbanization. In summary, evergreen trees, a diverse landscape with fragmented forest patches, and more complex and natural forest edges are more highly valued in Rural-Urban interfaces. In contrast, deciduous and mixed forests, larger forest blocks, and smoothly trimmed and man-made forest patch boundaries are more highly valued in urban core areas. As spatial variation in amenity values differs across a metropolitan area, the need for site-specific land use management to fit the local characteristics is recognized.

This paper presents spatially explicit analyses of the greenspace contribution to residential property values in a hedonic model. The paper utilizes data from the housing market near downtown Los Angeles. We first used a standard hedonic model to estimate greenspace effects. Because the residuals were spatially autocorrelated, we implemented a spatial lag model as indicated by specification tests. Our results show that neighborhood greenspace at the immediate vicinity of houses has a significant impact on house prices even after controlling for spatial autocorrelation. The different estimation results from non-spatial and spatial models provide useful bounds for the greenspace effect. Greening of inner city areas may provide a valuable policy instrument for elevating depressed housing markets in those areas.

Küreselleşme süreciyle beraber cografi sınırlar önemini yitirmekle kalmamakta devletin kentleşme hareketlerini yönlendirme kabiliyeti de zayıflatmaktadır. Bu arada, kentleşme politikaları da ütopik projelere dönüşmektedir. Kent mekânının biçimlenmesi devletin kent planlama fonksiyonlarının azalması ve bu fonksiyonun büyük ölçüde özel sektöre bırakılmasıyla beraber kent ve çevresi yeni bir form almaya başlamıştır. Bu form, kentin altkentleşme (güvenlikli siteler, villalar) şeklinde hızla çevreye yayılması (sprawl) biçimindedir. Özel sektör konut firmaları bu süreçte üretim ve pazarlama stratejileri ile belirleyici bir rol oynamaktadır. Kurdukları yeni yerleşim mekanlarını pazarlama stratejileri ütopik öğeler içermektedir.

This is a paper prepared by me for the Indian Institute of Management Bangalore-CRERI Real Estate Research Initiative. The paper is intended as a overview of the affordable housing sector with special emphasis on India. Affordable Housing is fast taking centrestage in the national agenda. In India, affordable housing is a term largely used in the urban context.Affordable housing refers to any housing that meets some form of affordability criterion, which could be income level of the family, size of the dwelling unit or affordability in terms of EMI size or ratio of house price to annual income.
The demand drivers for affordable housing are several.Alongside the growth of the urban population, rising incomes have led to the expansion of the middle class. This has led to a spike in demand for housing that is affordable but includes basic amenities. The agencies working in the affordable housing sector can be classified into . the public sector and the private sector. Both are dogged by issues such as scarcity of land,scarcity of marketable land parcels,titling Issues, rising costs and regulatory concerns. The way forward calls for a collaborative multi-pronged multi-stakehoder approach.