The Impact of Railway Stations on Residential and Commercial Property Value: A Meta Analysis

Posted: 28 Mar 2007

See all articles by Ghebreegziabiher Debrezion

Ghebreegziabiher Debrezion

Tinbergen Institute

Eric A. J. H. Pels

Vrije Universiteit - Department of Spatial Economic

Piet Rietveld

VU University Amsterdam - Department of Spatial Economics (Deceased)

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Abstract

Railway stations function as nodes in transport networks and places in an urban environment. They have accessibility and environmental impacts, which contribute to property value. The literature on the effects of railway stations on property value is mixed in its finding in respect to impact magnitude and direction, ranging from a negative to an insignificant or a positive impact. This paper attempts to explain the variation in the findings by meta-analytical procedures. Generally the variations are attributed to the nature of data, particular spatial characteristics, temporal effects and methodology. Railway station proximity is addressed from two spatial considerations: a local station effect measuring the effect for properties within 1/4 mile range and a global station effect measuring the effect of coming 250 meters closer to the station. We find that the effect of railway stations on commercial property value mainly takes place at short distances. Commercial properties within 1/4 mile range are 12.2% more expensive than residential properties. Where the price gap between the railway station zone and the rest is about 4.2% for the average residence, it is about 16.4% for the average commercial property. At longer distances the effect on residential property values dominate. We find that for every 250 meters a residence is located closer to a station its price is 2.3% higher than commercial properties. Commuter railway stations have a consistently higher positive impact on the property value compared to lights and heavy railway/Metro stations. The inclusion of other accessibility variables (such as highways) in the models reduces the level of reported railway station impact.

Keywords: property value, railway station, accessibility, light railways, heavy railway/Metro, commuter railway, meta-analysis

Suggested Citation

Debrezion, Ghebreegziabiher and Pels, Eric A.J.H. and Rietveld, Piet, The Impact of Railway Stations on Residential and Commercial Property Value: A Meta Analysis. Journal of Real Estate Finance and Economics, Vol. 35, No. 2, 2007, Available at SSRN: https://ssrn.com/abstract=975090

Ghebreegziabiher Debrezion

Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

Eric A.J.H. Pels (Contact Author)

Vrije Universiteit - Department of Spatial Economic ( email )

De Boelelaan 1105
1081HV Amsterdam
Netherlands
+31-20-4446049 (Phone)
+31-20-4446004 (Fax)

Piet Rietveld

VU University Amsterdam - Department of Spatial Economics (Deceased)

De Boelelaan 1105
1081HV Amsterdam
Netherlands
+31 20 4446097 (Phone)
+31 20 4446004 (Fax)

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