Abstract
Residential land use in urban areas can be constrained by zoning or restrictive covenants. When covenants and zoning exist simultaneously, covenants can facilitate an efficient allocation of high-restriction and low-restriction residential land. However, covenants cannot remedy deadweight loss resulting from zoning that over-allocates land to high restriction use. We examine subdivided, vacant residential lot sales from two residential zones which differ in both minimum lot size and the minimum square feet of house. Our findings of a negative price effect from covenant use in the more restricted zone suggest that private restrictions are over-supplied in that zone. (JEL R14, R52)
This article requires a subscription to view the full text. If you have a subscription you may use the login form below to view the article. Access to this article can also be purchased.
