The Effect of Upzoning on House Prices and Redevelopment Premiums in Auckland, New Zealand
39 Pages Posted: 3 Mar 2020
Date Written: October 1, 2019
Abstract
We study the effects of a large-scale upzoning on house prices and redevelopment premiums in Auckland, New Zealand. Upzoning significantly increases the redevelopment premium, but the overall effect on house prices depends on the economic potential for site redevelopment, with underdeveloped properties appreciating relative to intensively-developed properties. Notably, intensively-developed properties decrease in value relative to similar dwellings that were not upzoned, showing that the large-scale upzoning had an immediate depreciative effect on pre-existing intensive housing. Our results show that the economic potential for site redevelopment is fundamental to understanding how changes in land use regulations affect property values and housing affordability.
Keywords: Upzoning, Land Use Regulations, House Pirces, Redevelopment Premium
JEL Classification: R14, R21, R31, R52
Suggested Citation: Suggested Citation