The Effects of Upzoning on Property Prices and Developer Ownership: Evidence from Portland and Minneapolis using Synthetic Control and Difference in Differences Approaches

Abstract

Using Synthetic Controls, Synthetic Difference and Differences, and Difference in Differences methods, I analyze Oregon's 2019 statewide upzoning legislation and Minneapolis's 2020 upzoning ordinance as a policy shock to measure the short-run effects allowing for increased density on the sale price, sale volume, corporate purchases, and cash-only purchases of low density property in Portland and Minneapolis. In addition, I analyze the effects of the same Minneapolis ordinance on property prices around transit centers, which also saw new zoning rules that allow for increased build heights. I find that the signing of the legislation did not cause a statistically significant difference in any of the four characteristics in Portland, but that the upzoning did cause corporate purchases of low density property in Minneapolis to increase by about 6%. I also find that the transit-centric upzoning caused a roughly 12% increase in the price of all type of property values in Minneapolis.