Since Brooklyn Heights was designated as New York City’s first landmarked neighborhood in 1965, the Landmarks Preservation Commission has designated 120 historic neighborhoods in the city. Although proponents of historic districts often argue that such districts raise property values and the quality of life in the neighborhood (and the city), and critics charge that they discourage investment, evidence about the effect historic districts have on the price of residential property is limited, and there is virtually no evidence on how designation affects decisions to invest in housing renovation. In part, the lack of evidence stems from the difficulty of identifying the effect of designation separate from the pre-existing differences between properties within a historic district and those outside. This paper exploits variation in the timing of historic district designations in New York City to identify the effects preservation policies have on residential property markets. We combine an extensive dataset of residential transactions during the 35-year period between 1974 and 2009 with data from the Landmarks Preservation Commission on the location of the city’s historic districts and the timing of the designations. We also use a unique dataset of building permits to study impacts the designations had on renovation activity. We find that designation raises property values modestly within historic districts for the boroughs outside Manhattan, and that the effects wear off over time. In Manhattan, designation has a significant negative effect on property values within the district. We find little spillover effect on adjacent properties located immediately outside of the district. Finally, we find a modest reduction in renovation activity, beginning about ten years after designation.