Housing market shifts favouring transit-oriented development in emerging economies: the link between metro rails and housing price dynamics in Delhi

This paper aims to understand the spatiotemporal influence of metro rail connectivity on housing prices in surrounding areas. The study assesses the average annual price shift for apartments around metro stations in Delhi during the previous decade, specifically from 2010 to 2019. The authors examine the spatiotemporal extents to which housing prices are determined by the prominence of metro stations and spatial development around metro stations.

The authors perform the cross-tabulation analysis to calculate chi-square values to test the hypotheses concerning the responsiveness of the housing market in Delhi to the number of locational variables in the areas connected with the mass public transportation system.

The empirical findings verify the existence of a housing market overvaluation in Delhi around metro stations until 2013, which was eventually re-adjusted after 2014. The key findings of the study suggest the role of location variables concerning metro rails in the shooting up of the housing prices in the city. In addition, the research establishes the association of annual housing price shifts to the metro rails in the short-term, mid-term and long-term in conjunction with the distance from the metro station.

In the market, the prices are often overvalued by real estate agents due to better connectivity to the metro stations. The overvaluation eventually causes massive downfalls in housing markets and rollouts as a risk for the investors. However, the effect of mass transportation on housing prices is mixed in nature, limited to a certain extent only and not as influential as frequently portrayed by the market forces. This effect loses colour with time.