IDEAS home Printed from https://ideas.repec.org/a/eee/ecolec/v69y2010i11p2233-2243.html
   My bibliography  Save this article

The effects of wildfire and environmental amenities on property values in northwest Montana, USA

Author

Listed:
  • Stetler, Kyle M.
  • Venn, Tyron J.
  • Calkin, David E.

Abstract

This study employed the hedonic price framework to examine the effects of 256 wildfires and environmental amenities on home values in northwest Montana between June 1996 and January 2007. The study revealed environmental amenities, including proximity to lakes, national forests, Glacier National Park and golf courses, have large positive effects on property values in northwest Montana. However, proximity to and view of wildfire burned areas has had large and persistent negative effects on home values. The analysis supports an argument that homebuyers may correlate proximity to and view of a wildfire burned area with increased wildfire risk. Indeed, when a burned area is not visible from a home, wildfire risk appears to be out of sight and out of mind for homebuyers. Findings from this research can be used to inform debate about efficient allocation of resources to wildfire preparedness, including public education programs, and suppression activities around the wildland-urban interface.

Suggested Citation

  • Stetler, Kyle M. & Venn, Tyron J. & Calkin, David E., 2010. "The effects of wildfire and environmental amenities on property values in northwest Montana, USA," Ecological Economics, Elsevier, vol. 69(11), pages 2233-2243, September.
  • Handle: RePEc:eee:ecolec:v:69:y:2010:i:11:p:2233-2243
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0921-8009(10)00234-X
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Loomis, John, 2004. "Do nearby forest fires cause a reduction in residential property values?," Journal of Forest Economics, Elsevier, vol. 10(3), pages 149-157, November.
    2. de Mendonca, Mario Jorge Cardoso & Vera Diaz, Maria del Carmen & Nepstad, Daniel & Seroa da Motta, Ronaldo & Alencar, Ane & Gomes, Joao Carlos & Ortiz, Ramon Arigoni, 2004. "The economic cost of the use of fire in the Amazon," Ecological Economics, Elsevier, vol. 49(1), pages 89-105, May.
    3. Geoffrey H. Donovan & Patricia A. Champ & David T. Butry, 2007. "Wildfire Risk and Housing Prices: A Case Study from Colorado Springs," Land Economics, University of Wisconsin Press, vol. 83(2), pages 217-233.
    4. Loomis, John B. & Le, Hung Trong & Gonzales-Caban, Armando, 2005. "Testing transferability of willingness to pay for forest fire prevention among three states of California, Florida and Montana," Journal of Forest Economics, Elsevier, vol. 11(3), pages 125-140, December.
    5. Margot Lutzenhiser & Noelwah R. Netusil, 2001. "The Effect Of Open Spaces On A Home'S Sale Price," Contemporary Economic Policy, Western Economic Association International, vol. 19(3), pages 291-298, July.
    6. Spring, Daniel A. & Kennedy, John O.S., 2005. "Existence value and optimal timber-wildlife management in a flammable multistand forest," Ecological Economics, Elsevier, vol. 55(3), pages 365-379, November.
    7. Snyder, Stephanie A. & Kilgore, Michael A. & Hudson, Rachel & Donnay, Jacob, 2008. "Influence of purchaser perceptions and intentions on price for forest land parcels: A hedonic pricing approach," Journal of Forest Economics, Elsevier, vol. 14(1), pages 47-72, January.
    8. Loomis, John B. & Gonzalez-Caban, Armando & Englin, Jeffrey E., 2001. "Testing For Differential Effects Of Forest Fires On Hiking And Mountain Biking Demand And Benefits," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(2), pages 1-15, December.
    9. Mansfield, Carol & Pattanayak, Subhrendu K. & McDow, William & McDonald, Robert & Halpin, Patrick, 2005. "Shades of Green: Measuring the value of urban forests in the housing market," Journal of Forest Economics, Elsevier, vol. 11(3), pages 177-199, December.
    10. Kaval, Pamela & Loomis, John & Seidl, Andy, 2007. "Willingness-to-pay for prescribed fire in the Colorado (USA) wildland urban interface," Forest Policy and Economics, Elsevier, vol. 9(8), pages 928-937, May.
    11. Walker, Susan H. & Rideout, Douglas B. & Loomis, John B. & Reich, Robin, 2007. "Comparing the value of fuel treatment options in northern Colorado's urban and wildland-urban interface areas," Forest Policy and Economics, Elsevier, vol. 9(6), pages 694-703, February.
    12. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    13. Bennetton, Julia & Cashin, Paul & Jones, Darren & Soligo, James, 1998. "An economic evaluation of bushfire prevention and suppression," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 42(2), pages 1-27.
    14. Pamela Kaval, 2006. "The Relationship between Well-Being and Wildfire," Working Papers in Economics 06/14, University of Waikato.
    15. Okmyung Biny & Stephen Polasky, 2004. "Effects of Flood Hazards on Property Values: Evidence Before and After Hurricane Floyd," Land Economics, University of Wisconsin Press, vol. 80(4).
    Full references (including those not matched with items on IDEAS)

    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. Kiel, Katherine A. & Matheson, Victor A., 2018. "The effect of natural disasters on housing prices: An examination of the Fourmile Canyon fire," Journal of Forest Economics, Elsevier, vol. 33(C), pages 1-7.
    2. James R. Meldrum, 2016. "Floodplain Price Impacts by Property Type in Boulder County, Colorado: Condominiums Versus Standalone Properties," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 64(4), pages 725-750, August.
    3. Mitchell R. Livy, 2020. "Extreme natural events are associated with significant economic losses and expected to increase in frequency and intensity with time. While previous research has primarily investigated singular event ," Economics Bulletin, AccessEcon, vol. 40(1), pages 665-678.
    4. Charlotte Ham & Patricia A. Champ & John B. Loomis & Robin M. Reich, 2012. "Accounting for Heterogeneity of Public Lands in Hedonic Property Models," Land Economics, University of Wisconsin Press, vol. 88(3), pages 444-456.
    5. Varela, Elsa & Jacobsen, Jette Bredahl & Soliño, Mario, 2014. "Understanding the heterogeneity of social preferences for fire prevention management," Ecological Economics, Elsevier, vol. 106(C), pages 91-104.
    6. Mozumder, Pallab & Raheem, Nejem & Talberth, John & Berrens, Robert P., 2008. "Investigating intended evacuation from wildfires in the wildland-urban interface: Application of a bivariate probit model," Forest Policy and Economics, Elsevier, vol. 10(6), pages 415-423, August.
    7. Donadelli, M. & Jüppner, M. & Paradiso, A. & Ghisletti, M., 2020. "Tornado activity, house prices, and stock returns," The North American Journal of Economics and Finance, Elsevier, vol. 52(C).
    8. Horsch, Eric J. & Lewis, David J., 2008. "The Effects of Aquatic Invasive Species on Property Values: Evidence from a Quasi-Random Experiment," Staff Papers 92216, University of Wisconsin-Madison, Department of Agricultural and Applied Economics.
    9. Ti-Ching Peng, 2021. "The effect of hazard shock and disclosure information on property and land prices: a machine-learning assessment in the case of Japan," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 41(1), pages 1-32, February.
    10. Wasantha Athukorala & Wade Martin & Prasad Neelawala & Darshana Rajapaksa & Clevo Wilson, 2016. "Impact Of Wildfires And Floods On Property Values: A Before And After Analysis," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 61(01), pages 1-23, March.
    11. Ahmadiani, Mona & Ferreira, Susana, 2021. "Well-being effects of extreme weather events in the United States," Resource and Energy Economics, Elsevier, vol. 64(C).
    12. Justin Contat & Caroline Hopkins & Luis Mejia & Matthew Suandi, 2023. "When Climate Meets Real Estate: A Survey of the Literature," FHFA Staff Working Papers 23-05, Federal Housing Finance Agency.
    13. Zhen Xu & G. Cornelis van Kooten, 2013. "Living with Wildfire: The Impact of Historic Fires on Property Values in Kelowna, BC," Working Papers 2013-05, University of Victoria, Department of Economics, Resource Economics and Policy Analysis Research Group.
    14. Hansen, Winslow D. & Mueller, Julie M. & Naughton, Helen T., 2014. "Wildfire in Hedonic Property Value Studies," Western Economics Forum, Western Agricultural Economics Association, vol. 13(1), pages 1-14.
    15. Julie Mueller & John Loomis & Armando González-Cabán, 2009. "Do Repeated Wildfires Change Homebuyers’ Demand for Homes in High-Risk Areas? A Hedonic Analysis of the Short and Long-Term Effects of Repeated Wildfires on House Prices in Southern California," The Journal of Real Estate Finance and Economics, Springer, vol. 38(2), pages 155-172, February.
    16. Fabian Waltert & Felix Schlaepfer, 2007. "The role of landscape amenities in regional development: a survey of migration, regional economic and hedonic pricing studies," SOI - Working Papers 0710, Socioeconomic Institute - University of Zurich.
    17. Mueller, Julie M. & Loomis, John B., 2008. "Spatial Dependence in Hedonic Property Models: Do Different Corrections For Spatial Dependence Result in Economically Significant Differences in Estimated Implicit Prices?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 33(2), pages 1-20.
    18. Eric J. Horsch & David J. Lewis, 2009. "The Effects of Aquatic Invasive Species on Property Values: Evidence from a Quasi-Experiment," Land Economics, University of Wisconsin Press, vol. 85(3), pages 391-409.
    19. Seong-Hoon Cho & Christopher D. Clark & William M. Park & Seung Gyu Kim, 2009. "Spatial and Temporal Variation in the Housing Market Values of Lot Size and Open Space," Land Economics, University of Wisconsin Press, vol. 85(1), pages 51-73.
    20. Sofia F. Franco & W. Bowman Cutter, 2016. "The determinants of non-residential real estate values with special reference to local environmental goods," Nova SBE Working Paper Series wp603, Universidade Nova de Lisboa, Nova School of Business and Economics.

    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:eee:ecolec:v:69:y:2010:i:11:p:2233-2243. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ecolecon .

    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.