Descriptive Analysis on Housing Prices in Ames, Iowa
House prices in Ames, Iowa, are influenced by various factors, including zoning policies that govern different residential areas. This article explores the heterogeneity of housing prices based on zoning policies in Ames, Iowa, between 2006 and 2010. By exploring the descriptive relationship between zoning and house prices, this article aims to gain a better understanding of the housing market in Ames during this period.
Using a set of house prices data from Kaggle, the author is trying to conduct a simple analysis on house pricing and residential zoning density in Ames, Iowa, in the year of 2006–2010. There are 1,460 observations with an overall average house price of $180,921.2 USD. This amount is three times cheaper than the existing national average price house in USA which is around $516,500 USD (FRED, 2023). The significant gap is likely owing to the gradual increase of inflation and the geographical effects as Iowa is far flung from the capital city, Washington DC. Last but not least, the cheapest house in Ames costs $34,900 USD and the priciest one is $755,000 USD.
Housing Sale Frequency by Zoning Restrictions
The graph above shows that houses are mostly sold in the low-density residential. According to the 2006 and 2013 NHCS urban-rural classification scheme, Iowa is considered as “noncore”, easily translated as a county that is neither big nor small, with fewer people and limited access to healthcare services. Since it is neither a metropolitan nor micropolitan, residencies tend to be more dispersed. This indicates greater distances between dwellings. Hence, it is only natural that houses in low density zone are massively sold, claiming the largest share of all residencies sold as much as 78.84%.
Housing Price Distribution in Each Zone
a) Low Density Residential
The distribution of house prices in the low-density residential is positively skewed. This indicates that the majority of houses sold are in the affordable ranges. Between $127,000 and $152,000, there are 239 properties sold (20,76%). The cheapest property sold is $39,300 and the most expensive one is $755,000. Even so, the median sale price is $174,000.
b) Medium Density Residential
Similarly, property price distribution in the medium-density zone is also showing a positive skewed form. This suggests that the majority houses in this zone are sold at a comparatively cheaper price. The lowest price sold is $37,900 and the highest price is $475,000. While the median is $120,500 USD.
c) High Density Residential
On the other hand, house price distribution in high-density zone is normal. The limited number of observations in this zone accounts for the smaller distribution compared to other zones.
Interestingly, this zone has higher median value than the medium zone’s, suggesting higher prices. Higher housing density leads to reduced traffic congestion as it encourages walkability and better access to public transportation, resulting in shorter commute times.
d) Floating Villages
Much like others, this zone also shows a positive skew distribution. The median value is $205,950 and the highest property sold is $370,878 USD.
e) Others (Agriculture, Commercial, Industrial)
Others — agriculture, commercial, and industrial — shows a positive skew distribution with the lowest sale frequency among all. The median price is $74,700 USD.
Housing Price Comparison
When all zones are being juxtaposed, the medium value shows that floating villages zone has the highest property price sold among others, then followed by low density zone, and high density zone. This is likely due to the structural and infrastructure complexity, design, and other utilities that are only customized for floating villages.
The box plots also show one interesting thing: there are quite a number of outliers in the low-density zone, which indicates that several houses are overpriced. There is a similar case in the medium density and floating village (albeit only one property).
Conclusion
Ames, Iowa, is neither a metropolitan nor a micropolitan city. Under the 2006 and 2003 NCHS urban and rural classification, Iowa is classified as “noncore”. Residency tends to be more dispersed in this area, with limited source of healthcare service. This is reflected in the data of Kaggle’s House Prices in 2006–2010 whereas the majority of property sold is within the low-density zone (79%) with the approximate house price of $174,000 USD. However, the highest median house price is not owned by the low-density zone, but instead by the floating village (FV). This occurs naturally as floating homes requires more work and consideration in the making.
To conclude, this analysis underscores the diverse housing landscape in Ames, Iowa, with varying price ranges and housing types across different residential zones.
Tableau Dashboard: https://public.tableau.com/views/HousingPricesandZoning/Dashboard1?:language=en-GB&publish=yes&:display_count=n&:origin=viz_share_link
