The Impact of Enhanced School Zone Safety Regulations on Housing Prices: Evidence from Seoul Apartment Market

• In Event: Local Transportation Policies

Abstract

Safety regulations in school zones often face a trade-off between protecting children and creating neighborhood inconveniences. Based on Perry's Neighborhood Unit theory and its emphasis on the centrality of elementary schools in residential planning, we investigate whether safety regulations reshape the relationship between school proximity and housing prices in Seoul, South Korea. Our study focuses on "Minsik's Law," a 2020 policy that strengthened traffic safety measures around elementary schools through strict speed limits and enhanced penalties for violations.Using a continuous difference-in-differences design with hedonic pricing models, we examine apartment price changes from two spatial perspectives: Euclidean distance within 400m of elementary schools and pedestrian network distance within 800m based on the 15-minute City concept and Neighborhood Unit Theory. We compare quarterly apartment prices between treatment and control groups from 2015 to 2024.

Our event study reveals three key findings. First, prior to the regulation, 95% confidence intervals contained zero, supporting the parallel trends assumption. Second, immediately after implementation, apartments near elementary schools experienced a statistically significant price premium when measured by Euclidean distance, indicating that homebuyers valued the benefits of enhanced safety measures—including traffic calming devices, improved walking environments, and reduced traffic congestion—more than potential inconveniences. In contrast, the network distance analysis shows only slight effects, reflecting the mismatch between uniform-radius legal school zones and actual school attendance zones—if these boundaries were better aligned, we would expect similar results across both distance measures. Third, the price premium gradually diminished after approximately two years, returning to pre-regulation levels.

These findings have important policy implications. The initial price premium demonstrates that safety improvements can be effectively capitalized into housing values, suggesting broader resident preferences for traffic calming and enhanced pedestrian safety beyond families with elementary school-aged children. However, the temporal pattern reveals a critical challenge: following the Issue Attention Cycle, public attention declined after the initial implementation period, and enforcement weakened—only 6% of violators received actual prison sentences. The corresponding disappearance of the price premium indicates that housing markets respond not merely to regulatory existence, but to sustained enforcement and public awareness. This underscores that safety regulations require continuous implementation, monitoring, and periodic renewal of attention to maintain their intended effects and real-world impact.

Author

• Sunyoung Cho, University of Pennsylvania
  Presenting Author