The Value Impact of New Residential Construction and Neighborhood Disinvestment on Residential Sales Price

Posted: 22 Oct 1998

See all articles by Ivan Maric

Ivan Maric

Cleveland State University

Roberto Quercia

University of North Carolina (UNC) at Chapel Hill - Department of City and Regional Planning

Robert A. Simons

Cleveland State University

Abstract

The topic of neighborhood redevelopment is central to the field residential appraisal and the lending process. We examine both the effect of neighborhood upgrading and decline, captured by subsidized new residential construction and sustained property tax delinquency respectively, on the sales price of one-to two family homes. The research uses a two stage hedonic price model of 12,100 individual residential sales in the City of Cleveland, Ohio during 1992-94. Results show a significant positive effect of $670 on the sales price of existing housing for each new unit built in a one-to-two block area. A decrease in sales price of $778 is associated with a one percent increase in the tax delinquency rate. The spatial variability of these effects is also explored.

JEL Classification: R12, R13

Suggested Citation

Maric, Ivan and Quercia, Roberto G. and Simons, Robert A., The Value Impact of New Residential Construction and Neighborhood Disinvestment on Residential Sales Price. Journal of Real Estate Research, Vol. 15, No. 1/2, August 1998. Available at SSRN: https://ssrn.com/abstract=121188

Ivan Maric

Cleveland State University ( email )

Levin College
Cleveland, OH 44115
United States
216-687-5268 (Phone)

Roberto G. Quercia

University of North Carolina (UNC) at Chapel Hill - Department of City and Regional Planning ( email )

New East Building
Chapel Hill, NC 27599-3140
United States
919-962-4766 (Phone)
Not available (Fax)

Robert A. Simons (Contact Author)

Cleveland State University ( email )

Levin College 1737 Euclid, No. 128
Cleveland, OH 44115
United States
216-687-5258 (Phone)
216-687-9239 (Fax)

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
1,425
PlumX Metrics