IDEAS home Printed from https://ideas.repec.org/a/ire/issued/v10n022007p113-130.html
   My bibliography  Save this article

The Effect of Noise Barriers on the Market Value of Adjacent Residential Properties

Author

Listed:
  • Benoit Julien

    (Policy Integration – Renewal Programs Division, Agriculture and Agri-Food Canada, Sir John Carling Building, 930 Carling Avenue, Ottawa, Ontario, Canada K1A 0C5)

  • Paul Lanoie

    (Institut d’économie appliquée, École des Hautes Études Commerciales (HEC), 3000 Côte Ste-Catherine, Montreal, Quebec, Canada H3T 2A7)

Abstract

This paper provides the first study on the impact of noise barriers on the price of adjacent houses based on a repeat sale analysis (RSA). RSA allows us to empirically examine the differential between the prices of houses sold before and after an event that may have affected their value, and after other relevant variables such as the evolution of the real estate market and major renovations performed on the house are controlled. This paper focuses on the neighborhood of Laval, a suburb of Montreal, where a large noise barrier was built in 1990 along a highway. The data set contains transaction information on 134 houses that were sold at least twice from 1980–2000. The empirical result will show that the noise barrier induced a decrease of 6% in the house prices in our sample in the short run, while it had a stronger negative impact of 11% in the long run.

Suggested Citation

  • Benoit Julien & Paul Lanoie, 2007. "The Effect of Noise Barriers on the Market Value of Adjacent Residential Properties," International Real Estate Review, Global Social Science Institute, vol. 10(2), pages 113-130.
    • Handle: RePEc:ire:issued:v:10:n:02:2007:p:113-130
    as

    Download full text from publisher

    File URL: https://www.gssinst.org/irer/wp-content/uploads/2020/10/vol-10-no-2-the-effect-of-noise-barriers-on-the-market-value-of-adjacent-residential-properties.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Clapp, John M & Giaccotto, Carmelo, 1992. "Estimating Price Trends for Residential Property: A Comparison of Repeat Sales and Assessed Value Methods," The Journal of Real Estate Finance and Economics, Springer, vol. 5(4), pages 357-374, December.
    2. Bradford Case & Henry O. Pollakowski & Susan M. Wachter, 1991. "On Choosing Among House Price Index Methodologies," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 19(3), pages 286-307, September.
    3. Case, Bradford & Pollakowski, Henry O & Wachter, Susan M, 1997. "Frequency of Transaction and House Price Modeling," The Journal of Real Estate Finance and Economics, Springer, vol. 14(1-2), pages 173-187, Jan.-Marc.
    4. Case, Bradford & Quigley, John M, 1991. "The Dynamics of Real Estate Prices," The Review of Economics and Statistics, MIT Press, vol. 73(1), pages 50-58, February.
    5. J. R. Knight & Jonathan Dombrow & C. F. Sirmans, 1995. "A Varying Parameters Approach to Constructing House Price Indexes," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 23(2), pages 187-205, June.
    6. Dombrow, Jonathan & Knight, J R & Sirmans, C F, 1997. "Aggregation Bias in Repeat-Sales Indices," The Journal of Real Estate Finance and Economics, Springer, vol. 14(1-2), pages 75-88, Jan.-Marc.
    7. John M. Clapp & Carmelo Giaccotto & Dogan Tirtiroglu, 1991. "Housing Price Indices Based on All Transactions Compared to Repeat Subsamples," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 19(3), pages 270-285, September.
    8. Dean H. Gatzlaff & Marc T. Smith, 1993. "The Impact of the Miami Metrorail on the Value of Residences near Station Locations," Land Economics, University of Wisconsin Press, vol. 69(1), pages 54-66.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kwan Ok Lee & Alvan Hui Kiat Pang, 2022. "Railway sound barriers and housing prices," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 50(5), pages 1282-1306, September.
    2. Ioulia Ossokina & Gerard Verweij, 2014. "Urban traffic externalities: quasi-experimental evidence from housing prices," CPB Discussion Paper 267.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    3. Ossokina, Ioulia V. & Verweij, Gerard, 2015. "Urban traffic externalities: Quasi-experimental evidence from housing prices," Regional Science and Urban Economics, Elsevier, vol. 55(C), pages 1-13.
    4. De Schepper, Ellen & Van Passel, Steven & Manca, Jean & Thewys, Theo, 2012. "Combining photovoltaics and sound barriers – A feasibility study," Renewable Energy, Elsevier, vol. 46(C), pages 297-303.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Seow Eng Ong & Kim Hin David Ho & Chai Hoon Lim, 2003. "A Constant-quality Price Index for Resale Public Housing Flats in Singapore," Urban Studies, Urban Studies Journal Limited, vol. 40(13), pages 2705-2729, December.
    2. Dubé, Jean & Thériault, Marius & Des Rosiers, François, 2013. "Commuter rail accessibility and house values: The case of the Montreal South Shore, Canada, 1992–2009," Transportation Research Part A: Policy and Practice, Elsevier, vol. 54(C), pages 49-66.
    3. Denis Conniffe & David Duffy, 1999. "Irish House Price Indices — Methodological Issues," The Economic and Social Review, Economic and Social Studies, vol. 30(4), pages 403-423.
    4. McMillen, Daniel P., 2003. "The return of centralization to Chicago: using repeat sales to identify changes in house price distance gradients," Regional Science and Urban Economics, Elsevier, vol. 33(3), pages 287-304, May.
    5. Bourassa, Steven C. & Hoesli, Martin & Sun, Jian, 2006. "A simple alternative house price index method," Journal of Housing Economics, Elsevier, vol. 15(1), pages 80-97, March.
    6. Liang Peng, 2020. "Benchmarking Local Commercial Real Estate Returns: Statistics Meets Economics," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 48(4), pages 1004-1029, December.
    7. Daniel Melser, 2023. "Selection Bias in Housing Price Indexes: The Characteristics Repeat Sales Approach," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 85(3), pages 623-637, June.
    8. William Goetzmann & Liang Peng, 2001. "The Bias of the RSR Estimator and the Accuracy of Some Alternatives," Yale School of Management Working Papers ysm174, Yale School of Management, revised 01 Mar 2001.
    9. Gatzlaff, Dean H. & Haurin, Donald R., 1998. "Sample Selection and Biases in Local House Value Indices," Journal of Urban Economics, Elsevier, vol. 43(2), pages 199-222, March.
    10. Desen Lin & Shane T. Jensen & Susan M. Wachter, 2023. "The price effects of greening vacant lots: How neighborhood attributes matter," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 51(3), pages 573-610, May.
    11. Dubé, Jean & Rosiers, François Des & Thériault, Marius & Dib, Patricia, 2011. "Economic impact of a supply change in mass transit in urban areas: A Canadian example," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 46-62, January.
    12. Marvin L. Wolverton & Jimmy Senteza, 2000. "Hedonic Estimates of Regional Constant Quality House Prices," Journal of Real Estate Research, American Real Estate Society, vol. 19(3), pages 235-253.
    13. Shiller, Robert J, 1993. "Measuring Asset Values for Cash Settlement in Derivative Markets: Hedonic Repeated Measures Indices and Perpetual Futures," Journal of Finance, American Finance Association, vol. 48(3), pages 911-931, July.
    14. Wang, Ferdinand T. & Zorn, Peter M., 1997. "Estimating House Price Growth with Repeat Sales Data: What's the Aim of the Game?," Journal of Housing Economics, Elsevier, vol. 6(2), pages 93-118, June.
    15. Victor Ginsburgh & Jianping Mei & Michael Moses, 2006. "On the computation of art indices in art," ULB Institutional Repository 2013/7290, ULB -- Universite Libre de Bruxelles.
    16. Tom Nicholas & Anna Scherbina, 2013. "Real Estate Prices During the Roaring Twenties and the Great Depression," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 41(2), pages 278-309, June.
    17. G. Donald Jud & Terry G. Seaks, 1994. "Sample Selection Bias in Estimating Housing Sales Prices," Journal of Real Estate Research, American Real Estate Society, vol. 9(3), pages 289-298.
    18. Cannaday, Roger E. & Munneke, Henry J. & Yang, Tyler T., 2005. "A multivariate repeat-sales model for estimating house price indices," Journal of Urban Economics, Elsevier, vol. 57(2), pages 320-342, March.
    19. Bradford Case & Susan Wachter, 2005. "Residential real estate price indices as financial soundness indicators: methodological issues," BIS Papers chapters, in: Bank for International Settlements (ed.), Real estate indicators and financial stability, volume 21, pages 197-211, Bank for International Settlements.
    20. Andre H. Gao & George H. K. Wang, 2007. "Multiple Transactions Model: A Panel Data Approach to Estimate Housing Market Indices," Journal of Real Estate Research, American Real Estate Society, vol. 29(3), pages 241-266.

    More about this item

    Keywords

    noise barriers; housing market; repeat sale analysis;
    All these keywords.

    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ire:issued:v:10:n:02:2007:p:113-130. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: IRER Graduate Assistant/Webmaster (email available below). General contact details of provider: https://www.gssinst.org/gssinst/index.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.