From blight to boon: the impact of land banking programs on adjacent property values in Detroit, US

The rise in vacant properties is a major concern for cities, especially in economically distressed areas. These unoccupied properties frequently undermine community cohesion, safety, and property values, while prompting local government responsibilities for police, maintenance, and waste management. Land banking has surfaced as an advantageous approach to enable property transfer, revitalize neighborhoods, and increase tax revenue. Nevertheless, the direct, long-term, and multi-faceted impacts of land banking programs have not been sufficiently investigated. Therefore, this study examined the effects of five land banking programs on adjacent housing values in Detroit, Michigan, from 2011 to 2020. The adjusted interrupted time series-differences-in-differences model is utilized to estimate the implicit price for neighborhoods without extraneous influences. The findings indicate varied post-intervention trends: a gradual rise near Auction properties; an initial surge followed by decline near Partner Sales; and consistently lower values near Demolition sites. In the Side Lot program, a markedly lower housing values in the pre-intervention were observed, and the Own-It-Now program did not yield statistically significant effects. These results highlight the importance of tailored approaches for comprehending the long-term impacts of land banking programs. Expanding the scope of inquiry to include neighborhood satisfaction and cross-regional comparisons could offer deeper insights into program effectiveness.