A hedonic analysis of the impact of LUST sites on house prices
AbstractPetroleum from leaking underground storage tanks (LUSTs) can contaminate local soil and surface and groundwater. This can pose health risks to the surrounding population. Focusing on single family home sales from 1996 to 2007 in three Maryland Counties, we use a hedonic house price model and a difference–in-difference approach to estimate the willingness to pay to clean up the LUST sites. Particular attention is given to how property values are affected by leak and cleanup activity at a LUST site, the severity of contamination, the presence of a primary exposure pathway (i.e., private groundwater wells), and publicity surrounding a LUST site. The results suggest that although the typical LUST may not significantly affect nearby property values, more publicized (and more severe) sites can decrease surrounding home values by more than 10%.
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Bibliographic InfoArticle provided by Elsevier in its journal Resource and Energy Economics.
Volume (Year): 34 (2012)
Issue (Month): 4 ()
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Web page: http://www.elsevier.com/locate/inca/505569
LUST; Hedonic analysis; Groundwater contamination; Remediation benefits;
Find related papers by JEL classification:
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
- Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
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