The impact of flood dynamics on property values (original) (raw)
Related papers
Flood prone risk and amenity values: a spatial hedonic analysis
Australian Journal of Agricultural and Resource Economics, 2010
This study examines the impact of flood-hazard zone location on residential property prices. The study utilises data from over 2000 private residential property sales occurred during 2006 in North Shore City, New Zealand. A spatial autoregressive hedonic model is developed to provide efficient estimates of the marginal effect of flood prone risks on property prices. Results suggest that the sale price of a residential property within a flood prone area is lower than an equivalent property outside the flood prone area. The flood plain location discount is reduced by the release of public information regarding flood risk.
Assessing the impact of floods and flood legislation on residential property prices
The past decade has seen an increase in the number of significant natural disasters that have caused considerable loss of life as well as damage to all property markets in the affected areas. In many cases, these natural disasters have not only caused significant property damage, but in numerous cases, have resulted in the total destruction of the property in the location. With these disasters attracting considerable media attention, the public are more aware of where these affected property markets are, as well as the overall damage to properties that have been damaged or destroyed. This heightened level of awareness has to have an impact on the participants in the property market, whether a developer, vendor seller or investor. To assess this issue, a residential property market that has been affected by a significant natural disaster over the past 2 years has been analysed to determine the overall impact of the disaster on buyer, renter and vendor behaviour, as well as prices in these residential markets. This paper is based on data from the Brisbane flood in January 2011. This natural disaster resulted in loss of life and partial and total devastation of considerable residential property sectors. Data for the research have been based on the residential sales and rental listings for each week of the study period to determine the level of activity in the specific property sectors, and these are also compared to the median house prices for the various suburbs for the same period based on suburbs being either flood affected or flood free. As there are 48 suburbs included in the study, it has been possible to group these suburbs on a socio-economic basis to determine possible differences due to location and value. Data were accessed from realestate.com.au, a free real estate site that provides details of current rental and sales listings on a suburb basis, RP
Assessing flood impacts on the regional property markets in Queensland, Australia
The Australasian Journal of Regional Studies, 2015
Weather-related disasters such as floods have become more frequent over the last fifty years in regional communities of Queensland. Between December 2010 and January 2011, three-quarters of Queensland was declared as a disaster zone as a result of flooding. The Central Queensland (CQ) region was severely affected by this flood. To assess potential impacts on property markets, this study examined flood impacts through a case study of Rockhampton within the CQ region by using longitudinal data of the number of quarterly sales and median property price of all three segments of property market (i.e., total house sales, new house and land package sales, and land only sales), before and after the 2011 flood. In addition this study tested changes in the number of sales with a key regional economic impact i.e., mining boom, to test whether the flood impact has been offset by impacts of growth in the mining sector. This study found that flooding has affected the total number of house sales c...
Journal of Business Management and Accounting
The hedonic pricing model (HPM) has been used to identify the values of residentialproperty due to flood impact. Most of the previous studies had been conducted usingflood frequency and flood depth to measure flood variables rather than flood duration.The hedonic pricing study presented here investigated the effect of flood duration onresidential property value in Peninsular Malaysia. We measured the housing attributesinvolving location, structural, and neighborhood attributes. We also developed theinteraction variable between flood and structural attributes to determine whether theeffect of flood duration on residential property value differs across house age, size ofland area, and number of bedroom. The results suggest that the sale price of residentialproperty is significantly decreased by 0.015 percent due to flood.
The Spatial and Temporal Variability of Residential Real Estate Values in Response to Flooding
Disasters, 1988
A relationship between residential property values and the incidence of flooding is represented, using a case study of two Californian communities that were flooded following a levee break. Analysis of the real estate market before and after the flood shows that the flood was capitalized into housing values, whereby both list and selling prices dropped immediately and have recently begun to recover. However, recovery of the market is not uniform throughout the floodplain. Houses that suffered eighteen inches of water recovered to near pre-flood values in less than one year. In contrast, houses that had approximately ten feet of water in them have not recovered to the same extent, indicating that capitalization and recovery do not occur evenly. These findings suggest that policies and programs should address these spatial and temporal differences in recovery, which are expected to vary with different flood frequencies and magnitudes.
Flood and Land Property Values
Asian Social Science, 2016
Flood disaster has become a natural concern to the land owners where it raised a critical issue in term of land value depreciation. Previous studies have discussed the issue of potential decline in the value of land which are located on the flood-liable area. However, in Malaysia, current studies on flood impact are considered limited and do not focus on the effects of flood on land property. With the Hedonic Pricing Model (HPM) approach, we investigate the effect of flood on agricultural and industrial land property values in the urban and rural areas in Malaysia. The analysis indicates that the agricultural and industrial land values in the urban and rural areas have significantly decreased due to flood events. This study will benefit the land owners to understand the flood impact on land value and also the factors that contribute to the loss in the land value. It becomes the responsibility of the land owner to put the asset and property to its best use, given the presence of the flood. In addition, this study will help the policy maker to design and allocate land development efficiently in the urban or rural areas for agricultural and industrial project to ensure depreciation value of the land is minimized in the case of flood.
Flood hazards impact on neighborhood house prices: A spatial quantile regression analysis
Regional Science and Urban Economics, 2016
This study examines whether being located within a 100-year floodplain has an impact on the price of residential single-family house sales using house sales data in the Fargo-Moorhead Metropolitan Statistical Area between 2000 and 2013. A spatial quantile regression is applied to investigate the flood hazards impact on conditional higher-vs lower-priced homes, while accounting for spatial autocorrelation. The findings show that the location within a floodplain reduces property value. Furthermore, the negative impact of flood hazards on property values are stronger among lower-priced homes, and weaker among higher-priced homes. In addition, the study examines if a major flood in 2009 had an impact on the home buyers' perception about flood risk. The results show that about a year after the major flood, home buyers responded the most, however, the effect quickly diminished after 2010. Across quantiles, the 2009 flood had more effect on lower-priced than higher-priced homes.