Regulatory zoning and coastal housing prices: a bayesian hedonic approach (In French)

Monique Dantas, Frédéric Gaschet and Guillaume Pouyanne

Cahiers du GREThA (2007-2019) from Groupe de Recherche en Economie Théorique et Appliquée (GREThA)

Abstract: The priority for France’s “Grenelle II” environmental legislation is to reduce the consumption of space caused by urbanisation. The best tool for achieving this goal is zoning within a territorial planning framework. Yet zoning also tends to increase property values, due to the scarcity effects it provokes (restricting the supply of land) as well as its amenity effects (the capitalisation of land use externalities in housing pricing).\r\nThe present article studies the impact on property prices of the distance to regulated zones located on Arcachon Bay near Bordeaux in Southwest France – a region that is particularly conducive to this kind of analysis because it combines exceptional landscape quality and strong urban pressures. We have estimated a hedonic model corrected for spatial self-correlation. Heteroscedasticity is corrected using Bayesian simulation methods, as suggested by Le Sage and Parent (2006).\r\nThe findings reveal tension between urban and natural amenities in the determination of property prices. Proximity to facilities and coastal amenities increase prices. The impact on housing prices of zoning materialising through Land Use Plans (LUP) is corroborated. Protected natural zones tend to raise prices as long as long they are not used for agricultural or forestry activities. Conversely, proximity to zones of future urbanisation tends to lower housing prices.

Keywords: LUP zoning; Hedonic price method; Bayesian spatial econometrics; Coastal (search for similar items in EconPapers)
JEL-codes: Q15 Q24 Q51 R14 (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-env, nep-reg and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:grt:wpegrt:2010-12

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