Bourassa, Steven C.; Hoesli, Martin. (2022). Hedonic, Residual, and Matching Methods for Residential Land Valuation. Journal Of Housing Economics, 58.
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Abstract
• Our first method involves a hedonic model estimated for sales of vacant lots. • Another method depreciates improvements, obtaining land value as a residual. • Our third approach matches the sales of vacant and subsequently developed lots. • This allows us to estimate a hedonic model of land leverage (the ratio of land to total property value) for improved properties. • We conclude that the third approach is the most promising of the three methods. Accurate estimates of land values on a property-by-property basis are an important requirement for the effective implementation of land-based property taxes. We compare hedonic, residual, and matching techniques for mass appraisal of residential land values, using data from Maricopa County, Arizona. The first method involves a hedonic valuation model estimated for transactions of vacant lots. The second approach subtracts the depreciated cost of improvements from the value of improved properties to obtain land value as a residual. The third approach matches the sales of vacant lots with subsequent sales of the same properties once they have been developed. For each pair, we use a land price index to inflate the land price to the time of the improved property transaction and then calculate land leverage (the ratio of land to total property value). A hedonic model is estimated and used to predict land leverage for all improved properties. We conclude that the matching approach is the most promising of the methods considered. [ABSTRACT FROM AUTHOR]; Copyright of Journal of Housing Economics is the property of Academic Press Inc. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)
Keywords
Hedonic Method; Land Leverage; Land Valuation; Matching Approach; Residual Approach
Ruoniu (Vince) Wang is an Assistant Professor in the Runstad Department of Real Estate in the College of Built Environments at the University of Washington. He studies spatial justice and inclusive communities, including their impacts reflected in the built environment, human behaviors, and policy interventions. Vince joined the University of Washington after serving six years as the research manager and director in a national non-profit organization Grounded Solutions Network. He has designed and conducted a U.S. Census of inclusionary housing policies, a U.S. census of community land trusts, and a national performance evaluation of shared equity homeownership programs. His research expands to policy evaluation for the two largest federal assisted housing rental programs in the U.S.: the Low-Income Housing Tax Credit program and the Housing Choice Voucher program. Vince grounds his research with applied tools to democratize data for low-income communities.
The College of Built Environments launched a funding opportunity for those whose research has been affected by the ongoing pandemic. The Research Restart Fund, with awards up to $5,000, has awarded 4 grants in its first of two cycles. A grant was awarded to Real Estate faculty member Arthur Acolin, who is partnering with the City of Seattle’s Office of Planning and Community Development to understand barriers that homeowners, particularly those with lower incomes, face to building Accessory Dwelling Units…
El-Anwar, Omar. (2013). Maximising the Net Social Benefit of the Construction of Post-Disaster Alternative Housing Projects. Disasters, 37(3), 489 – 515.
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Abstract
The widespread destruction that follows large-scale natural disasters, such as Hurricane Katrina in August 2005, challenges the efficacy of traditional temporary housing methods in providing adequate solutions to housing needs. Recognising these housing challenges, the Congress of the United States allocated, in 2006, USD 400 million to the Department of Homeland Security to support Alternative Housing Pilot Programs, which are intended to explore the possibilities of providing permanent and affordable housing to displaced families instead of traditional temporary housing. This paper presents a new methodology and optimisation model to identify the optimal configurations of post-shelter housing arrangements to maximise the overall net socioeconomic benefit. The model is capable of quantifying and optimising the impacts of substituting temporary housing with alternative housing on the social and economic welfare of displaced families as well as the required additional costs of doing so. An application example is presented to illustrate the use of the model and its capabilities.
Keywords
Public Housing; Temporary Housing; Hurricane Katrina, 2005; Natural Disasters; Socioeconomic Factors; Mathematical Models; Mathematical Optimization; United States; Alternative Housing Pilot Programs; Optimisation; Socioeconomic Benefit; Disasters
Lacoe, Johanna; Bostic, Raphael W.; Acolin, Arthur. (2018). Crime and Private Investment in Urban Neighborhoods. Journal Of Urban Economics, 108, 154 – 169.
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Abstract
The question of how best to improve neighborhoods that lag behind has drawn considerable attention from policy-makers, practitioners, and academics, yet there remains a vigorous debate regarding the best approaches to accomplish community development. This paper investigates the role crime policy plays in shaping the trajectory of neighborhoods. Much of the existing research on neighborhood crime was conducted in rising-crime environments, and the evidence was clear: high levels of crime have adverse effects on neighborhoods and resident quality of life, This study examines how private investment in neighborhoods in two cities Chicago and Los Angeles changed as the incidence of neighborhood crime changed during the 2000s, a period when crime was declining city-wide in both places. Using detailed blockface-level data on the location of crime and private investments between 2006 and 2011, the analysis answers the question: Do changes in crime affect private development decisions? The results show that private investment, as represented by building permits, decreases on blocks where crime increases in the past year. We also find that the relationship between crime and private investment is not symmetric private investment appears to only be sensitive to crime in rising crime contexts. The result is present in both cities, and robust to multiple definitions of crime and the elimination of outliers and the main commercial district. These results suggest that crime-reduction policies can be an effective economic development tool, but only in certain neighborhoods facing specific circumstances.
Keywords
Enterprise Zones; Crime; Investment; Neighborhoods
Acolin, Arthur. (2020). Owning vs. Renting: The Benefits of Residential Stability? Housing Studies, 37(4), 644-647.
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Abstract
In housing research, owning, as compared to renting, is generally depicted as more desirable and associated with better outcomes. This paper explores differences in outcomes between owners and renters in 25 European countries and whether these differences are systematically smaller in countries in which owners and renters have more similar levels of residential stability (smaller tenure length gap). The results indicate that the direction of the relationship between tenure type and the selected outcomes is largely similar across countries. Owners generally exhibit more desirable outcomes (including life satisfaction, civic participation, educational outcomes for children, and physical and mental health). However, when looking at the relationship between outcomes and country level differences in tenure length gap, findings suggest that renters have outcomes that are more similar to owners in countries in which tenure length gaps are smaller. These results point to the potential benefits of policies that would increase residential stability, particularly for renters.
Keywords
European Union; Homeownership Benefits; Length Of Residence; Tenure; Home-ownership; Homeownership
Acolin, Arthur; Colburn, Gregg; Walter, Rebecca J. (2022). How Do Single-Family Homeowners Value Residential and Commercial Density? It Depends. Land Use Policy, 113.
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Abstract
This paper develops estimates of the relationship between local density and single-family home values using 2017 transactions for five U.S. metropolitan regions: Chicago, Los Angeles, Minneapolis, Philadelphia, Seattle. Proposals to build new commercial and residential development projects that would increase local density commonly face opposition from local homeowners. Academic literature links the response from homeowners to concerns that higher density is associated with lower property values but there is limited empirical evidence establishing this relationship at the local level. We find a positive and significant relationship between density and house value in the core area of the five metropolitan regions we analyze. Within 7.5 miles of the center of these metropolitan regions, a 10% increase in surrounding built area density is associated with a 1.1–1.9% increase in house prices per square foot. For outlying areas, the estimates are smaller and even negative in several cases. We instrument density based on topographic and soil characteristics and find similar results. These findings point to the need for a more nuanced discussion of the relationship between local density and housing values.
Keywords
Population Density; Soil Density; Single Family Housing; Home Ownership; Housing Development; Housing Discrimination; Home Prices; Los Angeles (calif.); Density; Single-family House Value; Urban Form; Residential Development; Real Estate; Property Values; Residential Density; Development Programs; Housing; Estimates; Metropolitan Areas; Development Projects; Empirical Analysis; Families & Family Life; Soil Characteristics
El-Anwar, Omar; Chen, Lei. (2013). Computing a Displacement Distance Equivalent to Optimize Plans for Postdisaster Temporary Housing Projects. Journal Of Construction Engineering And Management, 139(2), 174 – 184.
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Abstract
Residence in temporary housing is a critical period for the social, economic, and psychological recovery of displaced families following disasters. Temporary housing locations define the displacement distance between families and their essential needs. The objective of this paper is to develop a novel methodology to capture the specific proximity needs and preferences of displaced families. This paper proposes a displacement distance equivalent as an objective metric to evaluate the performance of temporary housing locations in meeting the needs of displaced families. Moreover, the paper describes the development of an integer programming optimization model capable of optimizing temporary housing assignments to minimize total displacement distance equivalent while meeting budget constraints. The main contribution of this paper to the body of knowledge is in transforming the purpose of temporary housing programs from offering general accommodation to providing customized housing solutions tailored to the individual proximity needs of each household using the proposed displacement metric. In addition, the proposed optimization model enables decision makers to set budget constraints to ensure the economic feasibility of identified temporary housing solutions. DOI: 10.1061/(ASCE)CO. 1943-7862.0000601. (C) 2013 American Society of Civil Engineers.
Keywords
Disasters; Emergency Management; Integer Programming; Social Sciences; Displaced Families; Customized Housing Solutions; Decision Makers; Displacement Metric; Budget Constraints; Integer Programming Optimization Model; Objective Metric; Temporary Housing Locations; Post-disaster Temporary Housing Projects; Displacement Distance Equivalent Computation; Multiobjective Optimization; Optimization; Temporary Housing; Disaster Recovery; Displacement Distance; Housing Sites
Walter, Rebecca J. (2018). Consolidating Zip Codes For Small Area Fair Market Rents: A Method For Implementing The New Rule. Housing Policy Debate, 28(4), 553 – 571.
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Abstract
Fair Market Rents (FMRs), calculated for an entire metropolitan region, are used to establish payment standards for the Housing Choice Voucher (HCV) program. In response to recent criticism that FMRs do not represent rent disparity and restrict households from moving to high-opportunity areas, a new rule introducing Small Area Fair Market Rents (SAFMRs) has been issued. SAFMRs are based on ZIP codes to reflect local market rents and increase the number of payment standards used to administer the HCV program. The purpose of this research is to determine whether the number of payment standards can be reduced by consolidating ZIP codes, while adhering to the primary objectives of the SAFMR rule. The ZIP code grouping process conducted offers one method for reducing the number of payment standards needed to implement the new rule; however, the rent analysis reveals the over- and underestimation of SAFMRs for some ZIP codes.
Keywords
Vouchers; Price; U.S Department Of Housing And Urban Development; Housing Choice Voucher Program; Fair Market Rents; Small Area Fair Market Rents; Standards; Markets; Payments; Housing; Households; Criticism; Metropolitan Areas; Postal Codes; State Court Decisions; Rents; Housing Policy; Rules
Gu, Naeun. (2020). Korean Apartment Complexes and Social Relationships of the Residents. Housing Studies, 35(8), 1362 – 1389.
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Abstract
Korean apartment housing, where more than half of the population lives, has drawn attention with its spatial, historical, and cultural uniqueness. Among many questions on Korean apartments, this article explains how the socio-spatial characteristics of apartment housing have impacts on the social relationships among the residents. This article first analyses the historical, socio-cultural, and spatial characteristics of Korean apartments, and then synthesizes up-to-date empirical study results to examine how the diverse characteristics can be associated with the residents' social relations. The empirical evidence clarifies the effects of Korean apartments' characteristics on residents' social relations-the exclusive complex design, spatial configurations, shared spaces including community facilities, heights of the units, public/private housing types, social homogeneity, and community programs are all associated with social relations of the residents. Key methodological problems in current studies as well as implications for future apartment planning are highlighted.
Keywords
Housing; Homogeneity; Shared Space (traffic Engineering); Empirical Research; Sociocultural Theory; High-rise High-density; Korean Apartments; Residents; Social Relationships; Socio-spatial Characteristics; Built Environment; South-korea; Neighborhood; Community; Health; City; Place; Density; Seoul; Configuration Management; Apartments; Uniqueness; Social Relations; Empirical Analysis; Characteristics