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• 1. [Article] Hedonic Analysis of Housing Prices Near the Portland Urban Growth Boundary, 1978-1990

  The cornerstones of Oregon's 1973 Senate Bill 100 are the preservation of farm, forest, and other resource lands and the containment of urban development within urban growth boundaries (UCB). The UCB is ...

  Citation × Citation Citation Abstract Copy Title: Hedonic Analysis of Housing Prices Near the Portland Urban Growth Boundary, 1978-1990 Author: Alkadi, Abdullah Year: 1996 The cornerstones of Oregon's 1973 Senate Bill 100 are the preservation of farm, forest, and other resource lands and the containment of urban development within urban growth boundaries (UCB). The UCB is a boundary around each incorporated city containing enough land to meet projected needs until the year 2000. The Land Conservation and Development Commission (LCDC), charged with adopting and implementing state planning policy, sought to keep UGBs small enough to contain urban sprawl. To avoid the potential effects of land price inflation, LCDC allowed UGBs to include more land supply than the forecasted demand. The Portland-Metropolitan region was allowed to have a 15.3-percent surplus. Policy makers are unsure what effect UGBs have on housing costs. The common belief is that by restricting the amount of land available for residential construction the market drives prices up. Contrasting opinions suggest that by substituting low-density with high-density development, per-unit construction costs are lower, thus reducing the costs of owning a home. Efforts to dispel some of the mystery about the relationship between UGBs and housing prices are needed. The objective of this research is to provide empirical evidence of the relationship between the Portland-Metropolitan area's UGB and housing prices. The study uses a hedonic model to conduct a time-series analysis for the years 1978 to 1990 for Washington County. This study found no relationship between housing price and the imposition of the UGB. In fact, the rate of increase in price for single-family housing after UGB implementation was found to be much less than before. Proximity as measured by distance of sale to the UGB was the only variable that was associated with a higher rate of increase in housing prices. All of these results, with the exception of those related to proximity, were unexpected but may be explained by several factors: imposition of the Metropolitan Housing Rule in 1981, a severe recession during the 1980s, and excess land supply. These influences do not support a conclusion that UGBs lead to an increase in housing prices, at least prior to 1990, when the UGB did not constrain the supply of land. Title: Hedonic Analysis of Housing Prices Near the Portland Urban Growth Boundary, 1978-1990 Author: Alkadi, Abdullah Year: 1996 The cornerstones of Oregon's 1973 Senate Bill 100 are the preservation of farm, forest, and other resource lands and the containment of urban development within urban growth boundaries (UCB). The UCB is a boundary around each incorporated city containing enough land to meet projected needs until the year 2000. The Land Conservation and Development Commission (LCDC), charged with adopting and implementing state planning policy, sought to keep UGBs small enough to contain urban sprawl. To avoid the potential effects of land price inflation, LCDC allowed UGBs to include more land supply than the forecasted demand. The Portland-Metropolitan region was allowed to have a 15.3-percent surplus. Policy makers are unsure what effect UGBs have on housing costs. The common belief is that by restricting the amount of land available for residential construction the market drives prices up. Contrasting opinions suggest that by substituting low-density with high-density development, per-unit construction costs are lower, thus reducing the costs of owning a home. Efforts to dispel some of the mystery about the relationship between UGBs and housing prices are needed. The objective of this research is to provide empirical evidence of the relationship between the Portland-Metropolitan area's UGB and housing prices. The study uses a hedonic model to conduct a time-series analysis for the years 1978 to 1990 for Washington County. This study found no relationship between housing price and the imposition of the UGB. In fact, the rate of increase in price for single-family housing after UGB implementation was found to be much less than before. Proximity as measured by distance of sale to the UGB was the only variable that was associated with a higher rate of increase in housing prices. All of these results, with the exception of those related to proximity, were unexpected but may be explained by several factors: imposition of the Metropolitan Housing Rule in 1981, a severe recession during the 1980s, and excess land supply. These influences do not support a conclusion that UGBs lead to an increase in housing prices, at least prior to 1990, when the UGB did not constrain the supply of land. Close