Open space, residential property values, and spatial context

We use hedonic analysis of home transaction data from the Minneapolis–St. Paul metropolitan area to estimate the effects of proximity to open space on sales price. We allow the effects of proximity to vary with demographic and location-specific characteristics and include fixed effects to control for observed and unobserved neighborhood characteristics. We find that the value of proximity to open space is higher in neighborhoods that are dense, near the central business district, high-income, high-crime, or home to many children. Using the metropolitan area's average value may substantially overestimate or underestimate the value of open space in particular neighborhoods.