Does bus accessibility affect property prices?

Existing studies have yet reached consistent conclusions on accessibility benefits of buses. Most existing studies have been conducted in the context of the West, where bus patronage is generally low. In this study, we used a database of 22,586 secondhand residential properties in 358 residential estates in Xiamen, China to develop four non-spatial hedonic pricing models (one standard and three Box-Cox transformed) and two spatial econometric models to quantify the effects of bus accessibility on property prices and analyze how the introduction of spatial econometric models would influence estimates of such benefits. Our findings are as follows. (1) Access to bus stops is positively correlated with property prices. This outcome is in contrast with findings of mainstream research (or conventional wisdom). For every bus stop within 500 m, the price of a property is 0.5% higher, all else being equal. (2) Bus travel times to essential destinations significantly influence housing prices. (3) Spatial econometric models that account for spatial autocorrelation outperform traditional hedonic pricing models. A few robustness check analyses further guarantee the plausibility of this study. However, the price premiums offered by bus accessibility may be gradually decreased, even eventually discarded, because of declining attractiveness for bus travel and continuous transit service enhancement in the forthcoming years.