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The Effects of Refineries on Neighborhood Property Values

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Abstract

Capitalization of negative neighborhood externalities may be affected over time by household sorting, events that attain public notoriety and the relative proximity of adjacent parcels to the externality. Using a 1,999-observation database spanning thirteen years all three of these issues are empirically investigated for two petrochemical refineries. As expected, evidence of sorting, short-term event effects and nearby proximity are all found to be contributors to capitalization. The extent of nearby buffering land areas also appears to contribute to reducing capitalization.

Suggested Citation

  • Patrick C. Flower & Wade R. Ragas, 1994. "The Effects of Refineries on Neighborhood Property Values," Journal of Real Estate Research, American Real Estate Society, vol. 9(3), pages 319-338.
  • Handle: RePEc:jre:issued:v:9:n:3:1994:p:319-338
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    Cited by:

    1. Céline Grislain-Letrémy & Arthur Katossky, 2013. "Les risques industriels et le prix des logements," Économie et Statistique, Programme National Persée, vol. 460(1), pages 79-106.
    2. Boxall, Peter C. & Chan, Wing H. & McMillan, Melville L., 2005. "The impact of oil and natural gas facilities on rural residential property values: a spatial hedonic analysis," Resource and Energy Economics, Elsevier, vol. 27(3), pages 248-269, October.
    3. Balthrop, Andrew T. & Hawley, Zackary, 2017. "I can hear my neighbors' fracking: The effect of natural gas production on housing values in Tarrant County, TX," Energy Economics, Elsevier, vol. 61(C), pages 351-362.
    4. George H. Lentz & Ko Wang, 1998. "Residential Appraisal and the Lending Process: A Survey of Issues," Journal of Real Estate Research, American Real Estate Society, vol. 15(1), pages 11-40.
    5. Peter C. Boxall, Wing H. Chan, and Melville L. McMillan, 2005. "The Impact of Oil and Natural Gas Facilities on Rural Residential Property," Working Papers eg0039, Wilfrid Laurier University, Department of Economics, revised 2005.
    6. Qinna Zhao & Robert A. Simons & Zhong Fen, 2016. "The Effect of Three Incineration Plants on Residential Property Values in Hangzhou, China," International Real Estate Review, Asian Real Estate Society, vol. 19(4), pages 515-546.
    7. Dennis Kaufman & Norman Cloutier, 2006. "The Impact of Small Brownfields and Greenspaces on Residential Property Values," The Journal of Real Estate Finance and Economics, Springer, vol. 33(1), pages 19-30, August.
    8. Grislain-Letrémy, Céline & Katossky, Arthur, 2014. "The impact of hazardous industrial facilities on housing prices: A comparison of parametric and semiparametric hedonic price models," Regional Science and Urban Economics, Elsevier, vol. 49(C), pages 93-107.
    9. Jean-Daniel Saphores & Ismael Aguilar-Benitez, 2005. "Smelly local polluters and residential property values: A hedonic analysis of four Orange County (California) cities," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 20(2), pages 197-218.
    10. Muriel Travers & Emmanuel Bonnet & Morgane Chevé & Gildas Appéré, 2009. "Perception des risques industriels dans une zone estuarienne : une analyse hédoniste spatiale," Économie et Prévision, Programme National Persée, vol. 190(4), pages 135-158.
    11. Mark P. Berkman & Kyle J. Hubbard & Timothy H. Savage, 2012. "The Adverse Impact of Particulate Matter on Property Values," International Real Estate Review, Asian Real Estate Society, vol. 15(2), pages 215-230.
    12. Jellicoe, Michaela & Delgado, Michael S., 2015. "Quantifying the Effects of Underground Natural Gas Storage on Nearby Residents," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 44(2), August.
    13. Katherine Kiel, 2006. "Environmental Contamination and House Values," Working Papers 0601, College of the Holy Cross, Department of Economics.
    14. Grislain-Letrémy, Céline, 2012. "Assurance et prévention des catastrophes naturelles et technologiques," Economics Thesis from University Paris Dauphine, Paris Dauphine University, number 123456789/9073 edited by Villeneuve, Bertrand.

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    JEL classification:

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

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