This paper estimates the effect on local house prices of opening asylum seekers’ reception centers (ASRCs) in the Netherlands, and whether there are differential effects across urban and rural areas. Asylum seekers are housed in ASRCs until a decision on their asylum claim is made.
The authors compare housing prices in the same areas before and after the opening of ASRCs, assuming price trends for houses near ASRCs and houses farther away would have remained similar if ASRCs had not been opened. The analysis is based on house sale prices from 2009 to 2017, together with the locations and opening dates of nearby ASRCs.
Main results:
- Overall, sale prices of homes in the vicinity of a ASRC were similar to home sale prices before the opening of the ASRC. However, this average effect masks heterogenous price effects by location (urban versus rural) and type of property.
- The opening of ASRCs negatively affected the prices of nearby homes in low residential density areas. On average, the opening of ASRCs in non-urban areas had a negative impact on the prices of single-family homes that are 500-1,000 meters away from an ARSC. These sold at prices five percent lower after an ASRC’s opening in their vicinity, compared to the prices of houses in areas that didn’t have an ASRC. No effect was found for houses in non-urban areas that were within 500 meters from large ASRCs—possibly because there is little transaction data, or because ASRCs are in zones that are characterized by non-residential land use. Additionally, no effect is found for urban areas or for apartments in rural areas.
- The effect on house prices increases with the hosting capacity of the ASRC. For ASRCs with a capacity to host 500 or more asylum seekers, the opening of ASRCs in non-urban areas causes single-family house prices to fall by approximately nine percent.
The authors conclude that, on average, the opening of ASRCs may not have a considerable effect on the prices of nearby houses, suggesting that ASRCs are not necessarily perceived as a source of disamenity. Opening of ASRCs reduces the prices of nearby houses only for housing in less densely populated areas and for ASRCs of high hosting capacity, and there are no effects on house prices in urban areas. The author suggests several reasons why this may be the case: in low-density areas, the reception of newcomers might overcrowd local public services; the diversity or presence of ‘others’ might be more noticeable in low-density areas; cities tend to have a higher presence of migrants and residents that have more positive attitudes to migrants; and agglomeration effects in cities might obscure possible negative amenities created by the presence of asylum seekers.