Land Value Modeling in Rural Communities

Investment in transportation systems has mainly been directed at the goal of reducing the cost of travel and increasing user benefits. This has been considered the best way to enhance production activities and thereby growth within the sphere of influence of the transportation system. In the recent years, however, the need for studies of all facets of transportation impact has been stressed, but until now impact studies have not been able to reveal the complex cause/effect relationship that exists between growth and development in a rural community and changes in the transportation system. This report concentrates on the impact on land values. It discusses why land values can be used as an indicator of community impact and evaluates a technique for modeling land values in a rural community. The technique is used in a case study of Sealy, Texas. Land value is expressed as a function of factors describing characteristics both of the transportation system provided and the community itself. Indices are evaluated in order to measure or rank qualitative levels of the factors, and the best regression models are found by regression analysis. In the case study a total of 611 land transactions in Sealy, Texas, are analyzed. These transactions took place between 1955 and 1973, throughout the entire community. Conclusions about how variance in land values can best be described are drawn, and areas where future research is needed are specified. For the convenience of the reader an annotated list of previous studies included.