Measuring the preference for dwelling characteristics of Melbourne: railway stations and house prices

The relationship between public transportation and home values has proven to be complex, with studies providing divergent findings. Using Victorian Valuer General Data for 2009, this paper applies a hedonic pricing approach to the Melbourne metropolitan housing market in order to estimate the impacts of proximity to a train station on residential property prices. The findings reveal that, proximity to train stations has an overall positive effect on property values. In general, all other things being equal, being located 1 km further out from a train station is associated with a 2% discount in sale price. The magnitude of this relationship is most clearly stable up to 5 kms from a train station. No dis-amenity effect on sale price for properties in close proximity to a train station was found.