Impacts of Ground Water Contamination on Property Values: Agricultural Run-off and Private Wells. (26th July 2016)

• Record Type: Journal Article
• Authors: Guignet, Dennis; Walsh, Patrick J.; Northcutt, Rachel
• Editors: Guilfoos, Todd; Uchida, Emi
• Is Part Of: Agricultural and resource economics review. Volume 45:Number 2(2016)
• Page Start: 293
• Page End: 318
• Publication Date: 2016-07-26
• Subjects: drinking water, -- ground water, -- hedonic, -- nitrate, -- nitrite, -- potable well, -- property value, -- water quality; Sustainable agriculture -- Periodicals; Sustainable agriculture -- United States -- Periodicals; Natural resources -- Periodicals; Agriculture -- Economic aspects -- Periodicals; Rural development -- Periodicals; 338.10974
• DOI: 10.1017/age.2016.16
• Languages: English
• ISSNs: 1068-2805

Abstract

Abstract : Few studies have examined the impacts of ground water quality on residential property values. Using a unique data set of well tests, we link residential real estate transactions to home-specific contamination and conduct a hedonic analysis of sales in Lake County, Florida, where pollution concerns relate primarily to agricultural run-off. We find that recent testing and contamination of ground water there correspond to a 2–6 percent depreciation in home values, an effect that diminishes over time. Focusing on nitrogen-based contamination, we find that prices decline mainly when concentrations exceed the regulatory health standard, suggesting as much as a 15 percent depreciation at levels twice the standard.