Document


Title

Impacts of environmental disturbances on housing prices: a review of the hedonic pricing literature
Document Type: Journal Article
Author(s): Sarah Nicholls
Publication Year: 2019

Cataloging Information

Keyword(s):
  • climate change
  • hedonic pricing
  • invasive species
  • literature review
  • pests
  • property values
Record Maintained By:
Record Last Modified: August 29, 2019
FRAMES Record Number: 58535

Description

The global environment is susceptible to many types of change, including alterations to the world's climate. Climate change has been linked to a host of modifications to the natural environment, including the increasing frequency and severity of disturbances such as pest outbreaks, invasions by non-native species, and wildfire. These in turn pose substantial risks to human wellbeing and health. Estimates of the direct and indirect costs of these events are important prerequisites to well-rounded cost-benefit analyses of preventative or control measures, themselves essential components of appropriate education, policy and management responses. This review brings together the evidence with respect to the impacts of disturbances such as pests, invasive species and wildfire on residential property values as measured using the hedonic pricing method. It demonstrates that whilst most disturbances have the expected negative or an insignificant house price impact, in some cases disturbances can lead to housing price rise. The possible causes and implications of these unanticipated positive price responses are discussed. Broader consequences of all directions of price impact are also considered, in particular for the development and implementation of polices designed to prevent the occurrence or spread of disturbances, or at a minimum mitigate their negative effects.

Online Link(s):
Citation:
Nicholls, Sarah. 2019. Impacts of environmental disturbances on housing prices: a review of the hedonic pricing literature. Journal of Environmental Management 246:1-10.