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Pricing Implications of Development Exactions on Existing Housing Stock
Author(s) -
DELANEY CHARLES J.,
SMITH MARC T.
Publication year - 1989
Publication title -
growth and change
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.657
H-Index - 55
eISSN - 1468-2257
pISSN - 0017-4815
DOI - 10.1111/j.1468-2257.1989.tb00499.x
Subject(s) - revenue , hedonic pricing , stock (firearms) , business , residential property , stock price , differential (mechanical device) , property value , finance , economics , econometrics , geography , real estate , engineering , paleontology , economic geography , archaeology , aerospace engineering , series (stratigraphy) , biology
Research has found that development exactions are capitalized into the price of new housing. As the price of new housing increases, one would expect to see a price rise in existing housing as well, albeit lagged to some extent. This paper presents the results of an empirical study designed to measure how much impact fees affect the price of existing, single‐family dwellings. Data for this study were obtained from county property appraiser files provided by the Florida Department of Revenue. The data represent 1,055 new and 3,135 existing home sales, respectively, in Dunedin, Florida, and 7,292 existing home sales in Clearwater, Florida, from 1971‐1982. On June 3, 1974, the city of Dunedin began assessing impact fees of $1,150 against all new, single‐family construction. The methodology used in this paper examines the price differential of new relative to existing housing and finds that the difference disappeared after six years.