Value of Transit as Reflected in U.S. Single-Family Home Premiums

Abstract

Although transit accessibility premiums have been rigorously studied at the local and regional levels for more than 40 years, drawing conclusions about premiums on a national scale requires a meta-analysis. Estimating effect size is a primary purpose of a meta-analysis. Effect size was calculated in 2007 by using pre-2003 studies but has not been studied since. This study sought to fill gaps in the literature by conducting a regression analysis and a thorough meta-analysis that reviewed 114 studies published from 1976 to 2014. Of 114 U.S. and Canadian single-family studies, a sample of 45 single-family studies was selected for further analysis. Compared with the previous meta-analysis, the current analysis found that, overall, U.S. and Canadian studies reported lower premiums on average for single-family houses. The average single-family home premium of 2.3% was significantly lower than the 4.2% premium calculated by the previous meta-analysis. It was found that reported transit premiums were decreasing over time as more variables, such as walkability of station areas, were statistically controlled. It was also found that compact regions with greater accessibility via transit produced higher transit premiums and transit premiums were neutral with respect to technology (light versus heavy rail) once regional compactness was controlled for. These findings suggest that to get the most out of transit investments, planners and public officials must make an effort to create compact regional development patterns and that single-family housing may not be the best use in areas close to transit.