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The Effects of Ambient Water Quality and Eurasian Watermilfoil on Lakefront Property Values in the Coeur d’Alene Area of Northern Idaho, USA

Author

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  • Felix Haifeng Liao

    (Department of Geography, University of Idaho, Moscow, ID 83844, USA)

  • Frank M. Wilhelm

    (Department of Fish and Wildlife Sciences, University of Idaho, Moscow, ID 83844, USA)

  • Mark Solomon

    (Idaho Water Resources Research Institute, University of Idaho, Moscow, ID 83844, USA)

Abstract

Amenity value of water resources has become a major driving force of recent population growth in the region centered on Coeur d’Alene Lake in northern Idaho, USA. Despite regulatory measures aimed to protect lake water quality, surface water quality is increasingly threatened by lakefront development and invasions of Eurasian watermilfoil ( Myriophyllum spicatum ), a non-indigenous aquatic plant species. We used hedonic modeling to estimate the effects of ambient water quality and the presence of Eurasian watermilfoil on lakefront property values of single-family homes in the Coeur d´Alene area. We find that property values are positively associated with Secchi depth (a proxy of water quality or clarity), and negatively related to the presence of watermilfoil. Results of spatial regime analysis indicate the geographical variations of these associations. The presence of watermilfoil was related to a 13% decline in mean property value, corresponding to $64,255 USD, on average, lower property sales price. Our study demonstrates that proactive mitigation approaches to cope with potential environmental degradation in lake ecosystems could have significant economic benefits to owners of lakefront properties and local communities.

Suggested Citation

  • Felix Haifeng Liao & Frank M. Wilhelm & Mark Solomon, 2016. "The Effects of Ambient Water Quality and Eurasian Watermilfoil on Lakefront Property Values in the Coeur d’Alene Area of Northern Idaho, USA," Sustainability, MDPI, vol. 8(1), pages 1-12, January.
    • Handle: RePEc:gam:jsusta:v:8:y:2016:i:1:p:44-:d:61714
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    Cited by:

    1. Dennis Guignet & Matthew T. Heberling & Michael Papenfus & Olivia Griot, 2022. "Property Values, Water Quality, and Benefit Transfer: A Nationwide Meta-analysis," Land Economics, University of Wisconsin Press, vol. 98(2), pages 191-218.
    2. Matthew T. Heberling & Dennis Guignet & Michael Papenfus, 2022. "Water Quality and Hedonic Models: A MetaAnalysis of Commodity, Market, and Methodological Characteristics," Working Papers 22-06, Department of Economics, Appalachian State University.

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