Space Matters: The Importance of Amenity in Planning Metropolitan Growth

22 Pages Posted: 24 Jan 2013

See all articles by Parvin Mahmoudi

Parvin Mahmoudi

University of Adelaide - School of Economics

Darla Hatton MacDonald

Government of the Commonwealth of Australia - Land and Water

Neville D. Crossman

affiliation not provided to SSRN

David M. Summers

affiliation not provided to SSRN

John Van der Hoek

University of Adelaide - Faculty of Engineering, Computer and Mathematical Sciences

Date Written: January 2013

Abstract

Most Australian capital cities require many 100,000s of additional dwellings to accommodate demographic change and population pressures in the next two or three decades. Urban growth will come in the form of infill, consolidation and urban expansion. Plans to redevelop environmental amenities such as parks and open green spaces are regularly being put forward to local councils and State governments. Maintaining parks and reserves represents one of the largest costs to local councils. To aid in the evaluation of some of the different propositions, we report the results of a spatial hedonic pricing model with fixed effects for Adelaide, South Australia. The results indicate that the private benefits of a close proximity to golf courses, green space sporting facilities, or the coast, are in the order $0.54, $1.58, and $4.99 per metre closer (when evaluated at the median respectively). The historic Adelaide Parklands add $1.55 to a property’s value for each additional metre closer. We demonstrate how the estimated model could be used to calculate how local private benefits capitalized in property values change with changes in the configuration of a park.

Keywords: hedonic pricing, water management and policy, spatial lag, fixed effects, open space, water restrictions

Suggested Citation

Mahmoudi, Parvin and Hatton Macdonald, Darla and Crossman, Neville D. and Summers, David M. and van der Hoek, John, Space Matters: The Importance of Amenity in Planning Metropolitan Growth (January 2013). Australian Journal of Agricultural and Resource Economics, Vol. 57, Issue 1, pp. 38-59, 2013, Available at SSRN: https://ssrn.com/abstract=2206094 or http://dx.doi.org/10.1111/j.1467-8489.2012.00608.x

Parvin Mahmoudi (Contact Author)

University of Adelaide - School of Economics ( email )

Adelaide SA, 5005
Australia
(+61 8) 8303 4932 (Phone)
(+61 8) 8223 1460 (Fax)

HOME PAGE: http://www.economics.adelaide.edu.au/pg/students/mahmoudi.html

Darla Hatton Macdonald

Government of the Commonwealth of Australia - Land and Water ( email )

GPO Box 1700
Canberra, Australian Capital Territory 2601
Australia

Neville D. Crossman

affiliation not provided to SSRN

No Address Available

David M. Summers

affiliation not provided to SSRN

No Address Available

John Van der Hoek

University of Adelaide - Faculty of Engineering, Computer and Mathematical Sciences ( email )

Adelaide SA 5005, 5005 SA
Australia

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