CEU Electronic Theses and Dissertations, 2025
| Author | Maierhofer, Felix |
|---|---|
| Title | Estimating the Announcement Effect of a Metro Expansion on Housing Prices: Evidence from Vienna |
| Summary | Urban policies, for instance changes to a city's public transport infrastructure, usually change the attractiveness of locations within a city, impacting housing prices. In this thesis, I attempt to estimate the causal effect of the U2 x U5 metro expansion in Vienna, announced in 2014, on housing prices in locations in spatial proximity to future stations. Since construction has not yet been completed, I focus on the effect of the announcement, which should alter people's expectations regarding the future value of a location and thus already impact prices. To estimate the effect, I use a binary Difference-in-Differences (DiD) design and a continuous quasi-DiD design with various sensitivity checks. I also use a Random Forest Model to attempt to isolate the causal effect through a different route. The dataset used contains data on apartment sales surrounding prospective stations and spanning the years 2012-2014, which I collected using a private firm's software. My findings suggest that the announcement decreased housing prices close to new stations by around 9-11\%. Although the estimated magnitude of the effect changes depending on the specification, the negative sign of the effect is robust to different specifications. This research indicates that the supposed positive effects of public transport construction projects on nearby residents may be outweighed by negative side-effects after construction is finished or nuisance during construction, which must be taken into consideration by policymakers. |
| Supervisor | Lieli, Robert |
| Department | Undergraduate Studies BA |
| Full text | https://www.etd.ceu.edu/2025/maierhofer_felix.pdf |
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