Residential land values in the Washington, DC metro area: New insights from big data

We use a new property-level data set and an innovative methodology to estimate the price of land from 2000 to 2013 for nearly the universe of detached single-family homes in the Washington, DC metro area and to characterize the boom-bust cycle in land and house prices at a fine geography. The results show that land prices were more volatile than house prices everywhere, but especially so in the areas where land was inexpensive in 2000. We demonstrate that the change in the land share of house value during the boom was a significant predictor of the decline in house prices during the bust, highlighting the value of focusing on land in assessing house-price risk. •We estimate residential land prices for the Washington, DC area over 2000–2013 at a fine level of geography.•The study uses an innovative methodology.•We find that land prices were more volatile than house prices everywhere but especially so in areas where land was inexpensive in 2000.•The change in the land share of house value during the boom was a significant predictor of the decline in house prices during the bust.•The results highlight the value of focusing on land in assessing house-price risk.