Valuing housing stock diversity

Abstract

Purpose

This paper seeks to explore the roles that different measures of housing stock and socio‐economic diversity have on the value of residential homes in San Diego, California.

Design/methodology/approach

This paper employs a hedonic pricing model to estimate the effects of different measures of diversity on housing prices based on a sample of approximately 6,500 houses in San Diego County, California. The measures of diversity can be classified broadly as either socio‐economic diversity (racial and ethnic diversity, variation in income, education, age, etc.) or diversity in housing stock (variability in housing and lot size, the age of structures, the mix or single family and multiple family, etc.).

Findings

The results suggest that home prices increase with greater diversity in the size of homes in a neighborhood, but tend to decrease with higher levels of diversity in the age of homes. In addition, there is evidence that smaller than average houses on smaller than average lots command a premium over other houses in the neighborhood.

Originality/value

The role of socio‐economic diversity on housing prices has been studied extensively. This paper explores the role of housing stock diversity in explaining variation in housing prices.

Citation

Narwold, A. and Sandy, J. (2010), "Valuing housing stock diversity", International Journal of Housing Markets and Analysis, Vol. 3 No. 1, pp. 53-59. https://doi.org/10.1108/17538271011027078