Have Housing Prices Risen Faster in Portland Than Elsewhere?

The Portland, OR, region has had a strong urban growth boundary (UGB) since 1979, so observers have focused on the relationship between its UGB and home prices, which rose sharply there during the 1990s. Many concluded that UGBs force home prices upward. But detailed analyses of home price movements from 1980 to 2000 show that prices did not rise nearly as fast in Portland as in many other regions in the 1980s, that home prices rose faster in Portland only from 1990 to 1994 or 1996, and that home prices in several other regions without UGBs were also rising rapidly. Multiple regression analyses of 85 large metropolitan areas showed that a dummy variable measuring the effect of Portland's UGB had statistically significant effects on home prices only in the first half of the decade. So it is erroneous to conclude from Portland's experience that UGBs inevitably cause home prices to rise faster.