Jayantha Wadu, M and Maqsood, T (2022) Transport infrastructure, accessibility and residential property values: Evidence from Hong Kong. Built Environment Project and Asset Management, 12(2), pp. 163-179. ISSN 2044-124X
Abstract
Hong Kong, like many other developed cities and countries, invests heavily in transport development. This study investigates whether the speculative benefits of future improvements in accessibility, brought about by impending transport development, will be capitalized into nearby residential property values even prior to the opening of the development. Deviating from the standard hedonic price approach, the present study employed a fixed-effects model with a large data set of residential property transactions in the vicinity of three-stations situated along a newly proposed mass-transit-railway line in Hong Kong. The results suggest that the values of residential properties close to stations do reflect the accessibility enhancements to be brought about by transport improvements even before the opening of the line. Results revealed a 6.5% of property value premium after the announcement of construction; and higher up to 6.7% after the operation of the line. This indicates that forthcoming new transport-infrastructure development produces changes in spatial price-gradients for neighbouring residential properties. Findings indicate that potential buyers/investors recognized the positive benefits of the planned transportation development, even before completion of the project, and are ready to pay a premium for those properties close to railway stations, representing clear evidence that residential property prices/values, near stations, reflect anticipated accessibility enhancements brought about by transport improvements. This study, using a novel approach - a fixed-effects model to capture the speculative benefits of future improvements in transport infrastructure - provides a positive hypothesis that expected benefits of future improvements in accessibility are capitalized into property values.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | transportation development; accessibility enhancement; residential property values; Hong Kong; infrastructure; property values; USA; New Jersey |
| Index terms: | residential property value, evidence, residential property, transport infrastructure, hedonic price, transportation development, infrastructure development, property value, railway station, Hong Kong, accessibility, investor, New Jersey |
| Subjects: | infrastructure engineering, Geography, inclusive design, infrastructure and transport systems, sociology, construction type, evaluation and assessment methods, real estate economics, urban planning |
| Topics: | Design Practice, Urban Studies, Research Practice, Geographical Context, Engineering Principles, Construction Technology, Stakeholder Management |
| Descriptive scope: | 3 PCA |
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