Report quantifies Luas effect on house prices

Report quantifies Luas effect on house prices

Postby SunnyDub » Tue May 19, 2009 7:41 pm

A new report quantifies

Economist Richard Tol: "The paper shows that light rail is really valuable".


A Hedonic Analysis of the Value of Rail Transport in the Greater Dublin Area

http://ideas.repec.org/p/esr/wpaper/wp264.html


Abstract:
We use a hedonic house price model to estimate the value of transport networks to homeowners in the Dublin area. Using a dataset of house sales between 2001 and 2006 and combining it with available geographical information system data on the train and tram lines in Dublin, it is possible to assess the values assigned to different transport links by homeowners. We find that the value of transport depends on how far from the property it is located and is also affected by the availability of alternative transport options in the area. There are differences in the values assigned to recently constructed tramlines compared to the traditional rapid transit train stations. The study also takes into account house characteristics and other environmental amenities.


http://www.esri.ie/UserFiles/publications/20081120141039/WP264.pdf
SunnyDub
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Re: Report quantifies Luas effect on house prices

Postby SunnyDub » Tue May 19, 2009 7:46 pm

Some extracts:

Luas: "In summary, properties within 500 metres to 2 kilometres of a light rail station are found to sell for between 7% and 17% more than properties not in proximity of the station. This suggests that there is a significant premium for home owners associated with the construction of a light rail system in their area".

Trains and DART: "Living very close to a train station (within 250m or 500m) results in a 7% to 8% premium on the house – lower than Luas stations, but still higher than the average estimate in the literature (Debrezion et al., 2007). The variables further away are not significant. The value of living very close to a train station in Dublin is due to saved commuting time, as trains are the main form of longer distance commute after cars. The DART station premium is approximately 5%. This lower premium may be due to the fact that areas serviced by the DART tend to benefit from good bus services as well. Certain areas serviced by the Luas did not have a good alternative and were relatively congested, hence the higher premium for light rail. Moreover, the DART service has not been renovated for quite some time and in consequence the light rail is deemed a more comfortable means of travel, which could help to explain why it commands a higher premium".
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Re: Report quantifies Luas effect on house prices

Postby SunnyDub » Tue May 19, 2009 7:48 pm

Also: "We find that living close to railway stations is considered a positive externality as it improves transportation access. Train tracks however have a negative impact on house prices as they bring about noise and visual intrusion. We have shown that the premium associated with the proximity to a rail link also depends on the type of rail considered. Indeed, the newer transport links in the Dublin area have a greater premium than older rail alternatives. We find the largest premium for light rail, followed by heavy rail and commuter transit. Debrezion et al. (2007) find the opposite order, and a generally lower impact. The different pattern in Dublin is probably explained by the age of the different rail systems, the frequency of the connections, and perhaps the location of the lines".
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Re: Report quantifies Luas effect on house prices

Postby SunnyDub » Tue May 19, 2009 7:51 pm

This is the sort of info that the Department of Transport, RPA, DTO should be using in deciding on their transport plans:

"As Figure 4 clearly indicates, the north side of the city is already using public transport and would benefit greatly from the addition of a rail line in the area. The Metro North project seems to be well placed in that respect and would also increase property values in the area. The advantages of the Metro West are however less clear-cut. The current lack of train lines in the area might seem to be a reason to locate a line there. However, the bus map does not clearly indicate a strong collection of bus users from the area. A line on the South side of the city in between and possibly linking elements of the current network may prove to have a larger uptake and a higher overall value. When deciding the appropriate location and scale of these projects, it is essential that public transport use, house density and house prices in the relevant areas be examined first".
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