Ask any real estate agent about a property’s value and they will state, “Location, location, location.” Del Mar is located by the beach, it is served by two good public school districts and we have easy access to the freeway (in comparison to Rancho Santa Fe, La Jolla and etc.). Some people would argue that if Del Mar had fewer restrictions on the building of residential homes our property values would increase more. Other people have argued that by having restrictions the ambience of Del Mar would be lost.
If is very difficult to determine the effect of restrictions on property values, because it is very difficult to find communities with the same “location, location, location” that have different restrictions on housing. In 2005, Amanda Agan and Alexander Tabarrok of George Mason University published an article comparing prices within the same subdivision of Virginia. ( Sandpiper website – “What are Private Governments Worth – Regulation ).
Their conclusion was that in order for non-regulated areas to have the same property values as regulated areas, a house would have to have at least one more bedroom. This seems to make sense as the houses across our border with San Diego have similar prices but are bigger.
So Del Mar seems to have a fourth location factor – we are a small town where we can have impact on how our community is modified when new houses are built. Rather than decreasing housing values, these restrictions increase not only are personal values, but our real estate values.