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Spillover effects from new housing supply

González-Pampillón, Nicolás (2022) Spillover effects from new housing supply. Regional Science and Urban Economics, 92. ISSN 0166-0462

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Identification Number: 10.1016/j.regsciurbeco.2021.103759

Abstract

I estimate spillovers from new housing supply on house prices. To estimate these effects, I use exogenous variation in supply induced by a housing subsidy implemented in middle-income neighborhoods in the city of Montevideo, Uruguay. I find evidence of externalities from the new supply on house prices, with prices increasing 12%. I explore two possible mechanisms of these externalities: income and crime rates. Although the evidence suggests a reduction in property crime rates, changes in the neighborhood income mix due to the supply expansion represent an important contributor to the external effects. These findings underline the role of amenities in the determination of local house prices.

Item Type: Article
Official URL: https://www.sciencedirect.com/journal/regional-sci...
Additional Information: © 2021 Elsevier B.V.
Divisions: What Works Centre
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HC Economic History and Conditions
JEL classification: R - Urban, Rural, and Regional Economics > R2 - Household Analysis > R23 - Regional Migration; Regional Labor Markets; Population
R - Urban, Rural, and Regional Economics > R3 - Production Analysis and Firm Location > R30 - General
R - Urban, Rural, and Regional Economics > R5 - Regional Government Analysis > R58 - Regional Development Policy
Date Deposited: 09 Dec 2021 15:30
Last Modified: 14 Dec 2021 08:48
URI: http://eprints.lse.ac.uk/id/eprint/112932

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