Estimating land value uplift around light rail transit stations in Greater Kuala Lumpur: An empirical study based on geographically weighted regression (GWR)
place - asia, place - urban, mode - tram/light rail, land use - impacts, economics - value capture
Geographically weighted regression (GWR), Hedonic pricing model, Land value uplift, Light rail transit, Land value capture, Greater Kuala Lumpur
Introducing a rail transit system into an urban region is expected to increase land values, and subsequently, residential property values. Despite this general belief, little is known about the spatial distributional effects of land value uplift. Thus, the goal of this paper is to provide new insights on how proximity to light rail transit stations may affect residential property values in Greater Kuala Lumpur, Malaysia using geographically weighted regression (GWR). The results provide information on spatial variations in the effects of a light rail transit system on residential property values. This study utilises GWR to account for spatial heterogeneity and spatial dependence. The results suggest that residential property values benefit from the provision of a light rail transit system but with considerable spatial variation over a geographical area. Evidently, proximity to the nearest light rail transit station gives positive premiums of up to 8% for a majority of properties located in lower-middle and upper-middle income neighbourhoods such as Wangsa Maju, Setapak, Keramat, Setiawangsa, Ampang and Sentul. In contrast, the impact of proximity to the nearest light rail transit station for properties located in high-income neighbourhoods such as Petaling Jaya was found to be non-significant. These findings can assist policy makers to better understand how properties around light rail transit stations accrue benefits. However, since the benefit of a light rail transit system on nearby properties varies over a geographical area (and where a positive premium can swing from positive to negative depending on the area), it may be difficult for policy makers to impose a single-value tax if there is a land value capture policy to be considered for implementation.
Permission to publish the abstract has been given by Elsevier, copyright remains with them.
Dziauddin, M.F. (2019). Estimating land value uplift around light rail transit stations in Greater Kuala Lumpur: An empirical study based on geographically weighted regression (GWR). Research in Transportation Economics, Vol. 74, pp. 10-20.