Changes in Amenity Values after COVID-19 Lockdowns in Auckland, New Zealand

Abstract

In the fight against the COVID-19 pandemic, New Zealand stood out with its ambitious elimination goal and the small death count per capita. The country’s strategy included full lockdown measures that were strict by international standards. In this paper we investigate whether New Zealand’s strict lockdowns brought significant changes to the dwelling price capitalisation of environmental amenities. Our results show a nuanced landscape. While before the pandemic, Auckland homebuyers were willing to pay a premium for dwellings located adjacent to open spaces, such premium either vanished or became a penalty during the lockdown phases. There was also a significant premium for dwellings within 300 m of beaches. But again such premium either decreases or becomes a penalty across the lockdown phases. In addition, we find a preference for dwellings located further away from Auckland CBD. Hence, some amenities that used to have a positive (or neutral) impact on the price of a property have now become disamenities from homebuyers’ perspective after the experience of the pandemic. This paper informs planners, policy-makers and private actors with a better understanding of the behaviour of Auckland’s housing market under the disruptions due to the pandemic and lockdowns.