Impact of fuel price on the development of the urban sprawl in Spain

•Higher fuel prices contribute to reduce the construction of single-family houses.•Higher income level increases the percentage of new single-family houses•Higher GDP per capita increases the construction of new apartment buildings.•Recession in Spain is an influential factor on the construction of apartment units.

This article analyses the impact of the variation in the price of fossil fuels on the development of the urban sprawl in Spain. The analysis is empirical and is based on a panel data collected in the provinces of Alicante, Almeria, Balearic Islands, Barcelona, Cadiz, Castellon, Cordova, Girona, Granada, Huelva, Jaen, Lleida, Madrid, Malaga, Murcia, Seville, Tarragona and Valencia from 2000 to 2010. This study combines the principles of the natural evolution theory with the price of fuels and two types of family houses: single-family houses and apartment buildings. The main finding drawn from the econometric analysis is that an increase in the price of fuel leads to a decrease in the construction rate of single-family houses. In addition, the study confirms the influence of other variables on the construction rate of single-family houses, such as household income, population size, cost of public transport and price of urban land.