Land Prices by State
The data provided here are estimates for 50 U.S. states and the District of Columbia of the prices and quantities of residential housing and its two components, land and structures. Estimated figures are all in nominal dollars (not in constant dollars adjusted for inflation) and reported quarterly from the first quarter of 1975 to the latest available quarter.
Quarterly values are estimated for six variables as follows:
- Home Value. This average value of owner-occupied houses (inclusive of land and structure) is estimated in two steps. First, the average value for each state is estimated in 1980, 1990, and 2000 using micro data from the Decennial Census of Housing (DCH). Then the Federal Housing Finance Agency (FHFA) quarterly repeat-sales (constant quality) house price indexes for each state are used to scale the home value series by quarter between 1980 and 2000 and to extend the home value series back from 1980 to 1975 and forward from 2000 to the most recent quarter. The growth rates of the reported FHFA indexes are adjusted so that their growth between 1980-1990 and 1990-2000 match the decennial growth of average house values from the DCH data. The 1980-1990 growth-rate adjustments are applied to the pre-1980 FHFA data and the 1990-2000 growth-rate adjustments are applied to the post-2000 FHFA data.
- Structure Cost. This is the replacement cost, after accounting for depreciation, of a typical owner-occupied housing structure for each state. First, the cost to build a new 1800-square foot 1-story home with a half-finished basement in 2000 is estimated using data from the R.S. Means Corporation. This cost is then adjusted for depreciation (assuming a 1.5 percent depreciation rate per year) using micro data on the age of owner-occupied structures by state, available in the 2000 DCH. Next, using R.S. Means annual construction cost indexes for the major metropolitan areas of each state, annual state-level construction cost indexes are created as the population-weighted average of the metropolitan area construction cost indexes. The resulting state-level construction cost indexes are applied to the year-2000 replacement cost estimates to create annual time series of construction costs from 1975 – 2009. These annual estimates are interpolated to quarterly ones.
- Land Value. The average value of land in each quarter is the Home Value less the replacement Structure Cost. When the value of land is estimated to be less than 5 percent of home value, which happens with some frequency, the value of land is set to 5 percent of home value and the replacement cost of structures is set to 95 percent of home value.
- Land Share. The land share is Land Value as a percent of Home Value.
- Home Price Index. The Home Price Index is based on the adjusted FHFA indexes used to compute the Home Value series. The second quarter of 1990 is defined as 100.
- Land Price Index. The Land Price Index is calculated with the method of Davis and Heathcote (2007) using estimates of the home value, the replacement cost of structures, land value, and the home price index. The second quarter of 1990 is defined as 100.
Use of data in a paper should include the following citation: Davis, Morris A. and Jonathan Heathcote, 2007, "The Price and Quantity of Residential Land in the United States," Journal of Monetary Economics, vol. 54 (8), p. 2595-2620; data located at Land and Property Values in the U.S., Lincoln Institute of Land Policy http://www.lincolninst.edu/resources/