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Capitalization and proximity to agricultural and natural lands: evidence from Delaware
Allison M Borchers1, Joshua M Duke
1Department of Food and Resource Economics, University of Delaware, Newark, DE 19716, USA. aborchers@ers.usda.gov
Abstract:
This paper offers an applied study assessing the price impacts of proximity to open space in a residential property market. Data are collected in an urban-influenced region of Delaware, USA, which has experienced rapid population growth--an 85 percent increase in number of households and 92 percent increase in population between Census 1990 and Census 2000--but also maintains substantial agricultural land use. In agreement with previous literature the results show the protection of agricultural and natural lands is capitalized into the value of neighboring properties. Surprisingly however, in this rapidly growing region the open space that is not protected from development offers no distinguishable effect on property values. This is likely because in a rapidly developing region all unprotected land is seen as potentially developable.
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