AMENITIES IN AN URBAN EQUILIBRIUM MODEL: RESIDENTIAL DEVELOPMENT IN PORTLAND, OREGON
Richard M. Adams and
Andrew J. Plantinga
No 21961, 2003 Annual meeting, July 27-30, Montreal, Canada from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)
This paper analyzes the effect of open space and other amenities on housing prices and development density within the framework of an urban equilibrium model. The model is estimated as a system of equations that includes households' residential choice decisions and developers' development decisions and emphasizes the importance of amenities in the formation of development patterns and property values. The model is applied to Portland, Oregon, where ambitious open space programs have been implemented. The results suggest that amenities are important: households are willing to pay more for newer houses located in areas of less dense development, with more open space, better views, less traffic congestion, and near amenity locations. For the developer, increases in housing prices result in an attempt to provide more and larger houses. The attempt to provide more houses, however, results in higher density, which will ultimately reduce prices. A simulation analysis evaluates the policy implications of the model results and indicates substantial benefits from alterations in housing patterns
Keywords: Community/Rural/Urban; Development (search for similar items in EconPapers)
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Journal Article: Amenities in an Urban Equilibrium Model: Residential Development in Portland, Oregon (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea03:21961
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