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Quasi-experimental evidence on the effect of traffic externalities on housing prices

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  • Ioulia Ossokina

    ()

  • Gerard Verweij

Abstract

This paper studies the effects on house prices of traffic nuisance on local streets. As source of exogenous variation in traffic nuisance we use the opening of a new state highway N14 in the Netherlands. This transport innovation altered the traffic density on the adjacent streets for some households, but left others unaffected. Controlling for spatial and house heterogeneity, we find that doubling of traffic density reduces housing prices with about 2%, what implies an upper value of traffic noise discount of about 0.5% per decibel. Our results indicate further that traffic nuisance discounts are likely to be misestimated in cross-sectional studies because nuisance tends to be correlated with omitted neighbourhood and housing amenities.

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Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa11p606.

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Date of creation: Sep 2011
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Handle: RePEc:wiw:wiwrsa:ersa11p606

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  16. Andersson, Henrik & Jonsson, Lina & Ögren, Mikael, 2008. "Property Prices and Exposure to Multiple Noise Sources: Hedonic Regression with Road and Railway Noise," Working Papers, Swedish National Road & Transport Research Institute (VTI) 2008:10, Swedish National Road & Transport Research Institute (VTI).
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