Specification and Estimation of a Spatial Hedonic Prices Model to Evaluate the Impact of Transmilenio on the Value of the Property in Bogota

This paper considers the identification and estimation of a spatial hedonic price model including the variable distance between the local properties and the nearest station of the massive transportation system Transmilenio (TM) in Bogotá, Colombia. We estimate a model to explain variations in land values with standard house attributes, environmental amenities, neighborhood attributes, security variables, and the distance formerly mentioned. The results suggest that the average elasticity proximity of TM, price of the land are -0.36, -0.55 and -1.13 for the first, second and third stages of TM in the same order. A change in one percent in the proximity of the property to the nearest TM station corresponds to a change in the average value of the land of 627 billions of Colombian 2005 pesos considering the whole universe of properties impacted by TM in the three stages. This value is approximately 0.978% of the Bogota's GDP in 2005