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Peer reviewed2022New York City

Do New Housing Units in Your Backyard Raise Your Rents?

Li

Main finding

Completed high-rises lowered nearby rents and sale prices even while attracting restaurants, suggesting the local supply effect outweighed the amenity effect.

A 10% local stock increase lowered nearby rents by about 1%

Most important limitation

The rent data omit many small buildings, and the result is hyperlocal.

From the publication

Inspect the authors' figure directly

Study chart · redrawn

Figure 3 · Rents before and after the completion year

The completion event study shows little pre-trend and a growing negative rent effect afterward.

REDRAWN FROM STUDY DATAFigure 3 · Rents before and after the completion year
Figure 3 · Rents before and after the completion yearThe completion event study shows little pre-trend and a growing negative rent effect afterward. Values digitized from Figure 3; the one-year estimate is checked against the reported −1.6% result in the archived publication; minor reading error is possible.-3%-2%-1%0%1%Rent effect (%)Years relative to completionNearby existing rentalsCOMPLETION−5−3−1+1+3+5

How this study is used

Claims this evidence supports

Strong evidenceMore homes give renters more leverage.See the full evidence stack →Strong evidenceSaying no to new homes does not make newcomers disappear.See the full evidence stack →

Policy connection

Solution guides informed by this study

01Make room for apartments, shops, and neighbors05Put more homes where the connections already are

Reference

Li (2022). “Do New Housing Units in Your Backyard Raise Your Rents?.”

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