Metropolitan land values and housing productivity
Year: 2012
Type: preprint
Abstract: We present the first nationwide index of directly-measured land values by metropolitan area and investigate their relationship with housing prices. Construction prices and geographic and regulatory constraints are shown to increase the cost of housing relative to land. On average, approximately one-third of housing costs are due to land, with an increasing share in higher-value areas, implying an elasticity of substitution between land and other inputs of about one-half. Conditional on land and construction prices, housing productivity is relatively low in larger cities. The increase in housing costs associated with greater regulation appears to outweigh any benefits from improved quality-of-life.
Source: SSRN Electronic Journal
Authors: David Albouy, Gabriel Ehrlich
Institution: University of Michigan
Language: English
Topic: Housing Market and Economics
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2484882579