The synergistic influence of light rail stations and zoning on home prices

Part of the attraction of modern rail investment is the potential for such investment to influence property values and generate development impacts. The occurrence of such impacts relies upon the existence of land-use policy that permits the desired development. A hedonic price model with interaction terms is used to empirically explore the synergistic impact of proximity to light-rail stations and permissive zoning regulations on home prices in San Diego, CA. The model results provide evidence that the premium value associated with rail proximity is conditional upon permissive zoning regulation. At the same time, it is found that permissive zoning has a harmful influence on home prices except in the area immediately surrounding rail stations