Elasticidad de los precios de viviendas frente a regulaciones urbanas: Evidencia por el lado de la oferta en Santiago, Chile

Lozano, Francisco Javier (2025): Elasticidad de los precios de viviendas frente a regulaciones urbanas: Evidencia por el lado de la oferta en Santiago, Chile. Forthcoming in:

Abstract

This study presents causal evidence elucidating the impact of urban regulations on housing prices through two opposing mechanisms: land value capitalization and construction cost efficiencies. Utilizing instrumental variables and transaction-level data, the research reveals that a 1% increase in building height results in a 0.10% reduction in prices, whereas the floor-area ratio leads to a 0.25% increase. Additionally, density (-0.16%) contributes to price reductions, aligning with efficient land utilization, while lot coverage operates as a price-increasing variable (0.13%). These effects demonstrate significant heterogeneity across urban contexts, with complete sign reversals contingent upon location and income. For example, the price-reducing effect of height is predominantly observed in low-value land and areas with high accessibility, yet it reverses to a price-increasing effect in peripheral locations. The study identifies notable complementarities among regulations, emphasizing developers’ strategic packaging of norms, particularly in the triple interaction between height, lot coverage, and floor-area ratio. The findings challenge uniform regulatory approaches, suggesting that policies aimed at affordability should advocate for strategic combinations of height and density, tailored to local market contexts.

• Item Type: MPRA Paper
• English Title: How sensitive are housing prices to urban regulations? Supply-side evidence from Santiago, Chile
• Language: Spanish
• Keywords: Urban economics, Housing prices, Land-use regulation, Causal inference
• Subjects: R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R14 - Land Use Patterns; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location > R31 - Housing Supply and Markets; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location > R38 - Government Policy

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