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COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility

The metro (or underground railways) has become a backbone in the transit systems of many cities. It has numerous externalities, such as ameliorating traffic congestion and enhancing nearby property prices. Previous studies extensively focused on the relationship between metro accessibility and prope...

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Autores principales: Yang, Linchuan, Liang, Yuan, He, Baojie, Lu, Yi, Gou, Zhonghua
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Elsevier Ltd. 2022
Materias:
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9023340/
http://dx.doi.org/10.1016/j.tust.2022.104528
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author Yang, Linchuan
Liang, Yuan
He, Baojie
Lu, Yi
Gou, Zhonghua
author_facet Yang, Linchuan
Liang, Yuan
He, Baojie
Lu, Yi
Gou, Zhonghua
author_sort Yang, Linchuan
collection PubMed
description The metro (or underground railways) has become a backbone in the transit systems of many cities. It has numerous externalities, such as ameliorating traffic congestion and enhancing nearby property prices. Previous studies extensively focused on the relationship between metro accessibility and property prices and obtained various interesting findings and enriched practical implications. However, this relationship in the era of the coronavirus disease 2019 (COVID-19) and other epidemic shocks has not been investigated. Based on a unique property transaction dataset (including tens of thousands of transactions stretching from 2018 to 2020) in Chengdu, China, this study develops a battery of hedonic pricing models and difference-in-differences models to decipher the time-varying relationship between metro accessibility and residential property prices. The results show that the implicit price of metro accessibility modestly decreases in COVID-19, which can be explained by the declining role of the metro. In other words, the price gap between proximate and distant properties is narrowed, and the property price gradient is flattened. Specifically, the price elasticity of distance to the metro is − 0.024 before COVID-19, but it turns to − 0.018 during the pandemic. The relative price of properties within 500 m from metro stations to those farther away (500 m − 3 km) decreases by 15.4% during the pandemic. Additionally, COVID-19 does not jeopardize property prices in Chengdu. Furthermore, the decrease in metro access premiums may be short-lived and only persisted for several months or years. The plausibility and robustness of the core findings have been confirmed through alternative treatment groups, alternative model specifications, and placebo tests.
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spelling pubmed-90233402022-04-22 COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility Yang, Linchuan Liang, Yuan He, Baojie Lu, Yi Gou, Zhonghua Tunnelling and Underground Space Technology Article The metro (or underground railways) has become a backbone in the transit systems of many cities. It has numerous externalities, such as ameliorating traffic congestion and enhancing nearby property prices. Previous studies extensively focused on the relationship between metro accessibility and property prices and obtained various interesting findings and enriched practical implications. However, this relationship in the era of the coronavirus disease 2019 (COVID-19) and other epidemic shocks has not been investigated. Based on a unique property transaction dataset (including tens of thousands of transactions stretching from 2018 to 2020) in Chengdu, China, this study develops a battery of hedonic pricing models and difference-in-differences models to decipher the time-varying relationship between metro accessibility and residential property prices. The results show that the implicit price of metro accessibility modestly decreases in COVID-19, which can be explained by the declining role of the metro. In other words, the price gap between proximate and distant properties is narrowed, and the property price gradient is flattened. Specifically, the price elasticity of distance to the metro is − 0.024 before COVID-19, but it turns to − 0.018 during the pandemic. The relative price of properties within 500 m from metro stations to those farther away (500 m − 3 km) decreases by 15.4% during the pandemic. Additionally, COVID-19 does not jeopardize property prices in Chengdu. Furthermore, the decrease in metro access premiums may be short-lived and only persisted for several months or years. The plausibility and robustness of the core findings have been confirmed through alternative treatment groups, alternative model specifications, and placebo tests. Elsevier Ltd. 2022-07 2022-04-22 /pmc/articles/PMC9023340/ http://dx.doi.org/10.1016/j.tust.2022.104528 Text en © 2022 Elsevier Ltd. All rights reserved. Since January 2020 Elsevier has created a COVID-19 resource centre with free information in English and Mandarin on the novel coronavirus COVID-19. The COVID-19 resource centre is hosted on Elsevier Connect, the company's public news and information website. Elsevier hereby grants permission to make all its COVID-19-related research that is available on the COVID-19 resource centre - including this research content - immediately available in PubMed Central and other publicly funded repositories, such as the WHO COVID database with rights for unrestricted research re-use and analyses in any form or by any means with acknowledgement of the original source. These permissions are granted for free by Elsevier for as long as the COVID-19 resource centre remains active.
spellingShingle Article
Yang, Linchuan
Liang, Yuan
He, Baojie
Lu, Yi
Gou, Zhonghua
COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility
title COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility
title_full COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility
title_fullStr COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility
title_full_unstemmed COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility
title_short COVID-19 effects on property markets: The pandemic decreases the implicit price of metro accessibility
title_sort covid-19 effects on property markets: the pandemic decreases the implicit price of metro accessibility
topic Article
url https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9023340/
http://dx.doi.org/10.1016/j.tust.2022.104528
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