The economic value of walkable neighborhoods

Abstract

This study investigated how the benefits of a walkable neighborhood were reflected in the American real estate market by examining the economic values of urban environmental factors supporting walking activities. Property values were used as a proxy measure for economic value and analyzed in relation to land use characteristics that have been known to correlate with walking at the neighborhood scale. Four aspects of the built environment supporting walking were included in the analyses: development density, land use mix, public open space and pedestrian infrastructure. Hedonic models were employed where the property value was regressed on the measures of the four sets of correlates of walking in a neighborhood. Models were estimated for four land use types- single-family residential, rental multi-family residential, commercial and office. The findings did not support previous arguments that increasing density weakens the quality of a neighborhood. To the contrary, the positive association of higher development density with the value of single-family residential properties detected in King County suggested that high development density might increase surrounding property values. The pedestrian infrastructure and land use mix significantly contributed to increases in rental multi-family residential property values. Higher development density with higher street and sidewalk coverage were also favored by retail service uses. In relation to land use mix, mixing retail service uses and rental multi-family residential uses helped make rental housings more attractive. © 2012 Macmillan Publishers Ltd.