Is There a Premium for Proximity? Assessing the Impact of MRT on Residential Property Prices in Greater Kuala Lumpur, Malaysia
DOI:
https://doi.org/10.37134/geografi.vol13.2.1.2025Keywords:
Mass Rapid Transit (MRT), residential property prices, hedonic pricing model (HPM), land value capture, Greater Kuala LumpurAbstract
Urban rail transit systems such as the Mass Rapid Transit (MRT) and Light Rail Transit (LRT) can produce a mix of beneficial and adverse effects on nearby communities, particularly for properties in close proximity to the infrastructure. This study focuses on the Sungai Buloh-Kajang (SBK) MRT Line in Greater Kuala Lumpur, Malaysia, and evaluates its influence on residential property values, taking into account both the favourable and unfavourable externalities associated with the transit system. To analyse these effects, a hedonic pricing model was applied to a dataset of residential transactions spanning from 2013 to 2019, encompassing properties situated within a 2-kilometer buffer of the SBK MRT corridor. The analysis accounts for comparable market conditions, income distribution, and housing types. The findings show that while properties near MRT stations generally experienced price increases, especially in middle- and lower-income areas, homes located extremely close to the MRT track in affluent neighbourhoods saw a decline in value. These results suggest that MRT systems can enhance residential property prices, but the benefits vary by location and socio-economic context. These findings underscore that while MRT systems can positively affect nearby residential property prices, these benefits are not uniform. The gains tend to be widespread, benefiting various neighbourhoods and housing types, whereas the downsides are more geographically limited. From a policy and urban planning perspective, the results highlight the value of integrating land value capture mechanisms and promoting transit-oriented development (TOD) strategies to harness these positive externalities more effectively.
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