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Comparing the impact of road noise on property prices in two separated markets

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  • Marieke Franck
  • Johan Eyckmans
  • Simon De Jaeger
  • Sandra Rousseau

Abstract

In this paper, we empirically test the stability of valuation estimates of road traffic noise based on house prices. A hedonic valuation model is constructed and estimated for two separate housing markets in Belgium. We estimate noise depreciation sensitivity index (NDSIs) for different modelling choices for both markets separately, jointly and taking into account spatial dependency. The results confirm that housing markets are region-specific and several housing characteristics are valued differently across regions. The effect of road noise, however, appears to be rather robust. Thus, the use of NDSI estimates from one region to value traffic noise in another region seems to be acceptable.

Suggested Citation

  • Marieke Franck & Johan Eyckmans & Simon De Jaeger & Sandra Rousseau, 2015. "Comparing the impact of road noise on property prices in two separated markets," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 4(1), pages 15-44, March.
    • Handle: RePEc:taf:teepxx:v:4:y:2015:i:1:p:15-44
    DOI: 10.1080/21606544.2014.951399
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    References listed on IDEAS

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    1. Jon P. Nelson, 2008. "Hedonic Property Value Studies of Transportation Noise: Aircraft and Road Traffic," Springer Books, in: Andrea Baranzini & José Ramirez & Caroline Schaerer & Philippe Thalmann (ed.), Hedonic Methods in Housing Markets, chapter 3, pages 57-82, Springer.
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    3. Marcel A. J. Theebe, 2004. "Planes, Trains, and Automobiles: The Impact of Traffic Noise on House Prices," The Journal of Real Estate Finance and Economics, Springer, vol. 28(2_3), pages 209-234, March.
    4. Andrea Baranzini & José V. Ramirez, 2005. "Paying for Quietness: The Impact of Noise on Geneva Rents," Urban Studies, Urban Studies Journal Limited, vol. 42(4), pages 633-646, April.
    5. Brett Day & Ian Bateman & Iain Lake, 2007. "Beyond implicit prices: recovering theoretically consistent and transferable values for noise avoidance from a hedonic property price model," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 37(1), pages 211-232, May.
    6. 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..
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