The Market Acceptance of Single-Family Housing Units in Smart Growth Communities (2009), by Mark J. Eppli and Charles C. Tu, addresses whether the smart growth price premium is sustained over time.
The study analyzes single-family house prices in the smart growth developments of Kentlands and Lakelands in Maryland relative to prices of comparable houses in non-smart growth developments. To measure the possibility of a smart growth price premium and the sustainability of that premium, the study employs the hedonic price methodology and a series of approximately 30 control variables.
Using more than 4,700 actual single-family sale transactions between 1997 and 2005 in Montgomery County, Maryland, the analysis reveals a price premium for Kentlands and Lakelands of 16 percent and 6.5 percent respectively over comparable homes in surrounding conventional subdivisions. Additionally, the price premium in Kentlands and Lakelands is sustained or increasing over time, indicating a strong and sustained market acceptance of single-family housing units in smart growth communities.
This paper was produced as part of Smart Growth: The Business Opportunity for Developers and Production Builders, a series of papers that present a "business case for smart growth" to help builders and developers considering whether to pursue smart growth projects.You may need a PDF reader to view some of the files on this page. See EPA’s About PDF page to learn more.