Border Effects in House Prices

Martin Micheli, Jan Rouwendal, Jasper Dekkers

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Abstract

This article estimates the effect of the Dutch–German border on house prices. We argue that the difference between house prices at the border indicates the willingness to pay to stay in a country compared to living across the border. After a change in the tax rules in 2001, migration from the Netherlands to Germany increased substantially and the gradient of Dutch house price towards the German border steepened. Combining a German and Dutch real estate dataset and using different estimation strategies, we find that asking prices of comparable housing drop by about 16% when one crosses the Dutch–German border.

Original languageEnglish
Pages (from-to)757–783
Number of pages27
JournalReal Estate Economics
Volume47
Issue number3
Early online date29 Jun 2018
DOIs
Publication statusPublished - Sep 2019

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