Impact of Dubai Metro on property values

• Main Author: Mohammad, Sara Ishaq
• Other Authors: Graham, Daniel ; Melo, Patricia
• Published: Imperial College London 2014
• Subjects: 624
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.679669

Despite the large number of case studies estimating the impact of railways on property values, there is as yet no research conducted specifically for the Dubai Metro. This study applies the existing empirical methods, corrected for sources of bias, to test for the effect of the Dubai Metro on the values of residential and retail properties. The results will also be of interest to neighbouring cities developing their first railways. The existing empirical work reveals a large variation in estimates for the effect of railways on property values. This thesis provides a comprehensive meta-analysis examining the sources of variation and relating these findings to the estimates for the Dubai Metro. As an addition to the existing literature, this study examines the effect on sale and rent values using repeated cross-sectional and pseudo panel data, and makes a case for the preferred data structure. Besides applying the known measures of accessibility to a metro, this research represents the first attempt to test for the effect of the change in the generalized cost of travel (GC) due to the operations of the metro. The results from the preferred models indicate negative, insignificant and positive impacts of the metro on the sale value of dwellings located at different distances. The metro also enhances the rent value of dwellings and the sale value of retail properties. The study also finds an increase in the value of dwellings due to a decrease in the GC. The results suggest that while a reduction in the GC of public transport boosts the sale value of retail properties, values are higher in areas with higher private and public transport trip rates. The positive effect of the metro implies that a value capture mechanism can be explored, provided the related policy implications are understood.