Expectations and land-value premiums: The metro effect on residential land in a consolidated city

Urban rail investments reshape land markets, yet rigorous evidence from the Global South, particularly regarding new projects in already consolidated cities, remains scarce. Bogotá, Colombia, provides a unique test case. In 2019, the city approved a 23.96 km elevated first metro line (L1) with 16 stations and simultaneously announced plans for a second, fully underground line (L2), now in procurement. This study offers a preliminary assessment of the debate over elevated versus underground alignments and their impact on land values. Using detailed cadastral data, we implement a two-step identification strategy. First, Coarsened Exact Matching (CEM) is used to create balanced samples: treatment blocks within 800 m of future stations and statistically comparable control blocks outside the metro corridors. Second, weighted log-linear regressions estimate price premiums while controlling for location, land-use characteristics, housing typology, and block-level attributes. The results reveal a robust premium effect from the mere announcement of the project. In 2019, residential land near L1 appreciated on average by 11.7% relative to matched controls, and the premium remained sizable, 8.8%, after 20% of construction was completed in 2023. Applying a similar model to the planned underground L2 yields an estimated 11.8% uplift. Infrastructure form also interacts with the existing built environment: blocks averaging fewer than four stories capture significantly smaller gains than taller blocks. By integrating CEM, this study provides the first estimate of anticipation-driven land-value change for a metro corridor in a consolidated city and quantifies how vertical morphology conditions those gains. The findings inform value-capture financing, identify where land development is most warranted, and contribute new evidence to the international debate on elevated versus underground urban rail design in rapidly growing cities.