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Valuing Beach Quality with Hedonic Property Models

Author

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  • Craig E. Landry
  • Paul Hindsley

Abstract

This paper explores the influence of beach quality on coastal property values. We hypothesize that beach and dune width provide local public goods in the form of recreation potential and storm/erosion protection, but services are limited by distance from the shoreline. Our findings support this hypothesis, as extending the influence of beach quality beyond 300 m from the shore generally results in statistically insignificant parameter estimates. For houses within this proximity bound, beach and dune widths increase property value. We argue that interpretation of marginal willingness to pay for beach quality depends upon individual understanding of coastal processes and expectations of management intervention.

Suggested Citation

  • Craig E. Landry & Paul Hindsley, 2011. "Valuing Beach Quality with Hedonic Property Models," Land Economics, University of Wisconsin Press, vol. 87(1), pages 92-108.
  • Handle: RePEc:uwp:landec:v:87:y:2011:i:1:p:92-108
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    References listed on IDEAS

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    1. Kevin M. Simmons & Jamie Brown Kruse & Douglas A. Smith, 2002. "Valuing Mitigation: Real Estate Market Response to Hurricane Loss Reduction Measures," Southern Economic Journal, Southern Economic Association, vol. 68(3), pages 660-671, January.
    2. Kriesel, Warren & Landry, Craig E. & Keeler, Andrew, 2005. "Coastal Erosion Management from a Community Economics Perspective: The Feasibility and Efficiency of User Fees," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 37(02), pages 451-461, August.
    3. Okmyung Bin & Jamie Brown Kruse & Craig E. Landry, 2008. "Flood Hazards, Insurance Rates, and Amenities: Evidence From the Coastal Housing Market," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 75(1), pages 63-82.
    4. 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..
    5. Jeffrey Pompe, 2008. "The Effect of a Gated Community on Property and Beach Amenity Valuation," Land Economics, University of Wisconsin Press, vol. 84(3), pages 423-433.
    6. Lansford, Notie H., Jr. & Jones, Lonnie L., 1995. "Recreational And Aesthetic Value Of Water Using Hedonic Price Analysis," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 0(Number 2), pages 1-15, December.
    7. Benson, Earl D & Hansen, Julia L. & Schwartz Jr., Arthur & Smersh, Greg T., 1998. "Pricing Residential Amenities: The Value of a View," The Journal of Real Estate Finance and Economics, Springer, vol. 16(1), pages 55-73, January.
    8. Clapp, John M. & Giaccotto, Carmelo, 1998. "Residential Hedonic Models: A Rational Expectations Approach to Age Effects," Journal of Urban Economics, Elsevier, vol. 44(3), pages 415-437, November.
    9. Leonard Shabman & Michael K. Bertelson, 1979. "The Use of Development Value Estimates for Coastal Wetland Permit Decisions," Land Economics, University of Wisconsin Press, vol. 54(2), pages 213-222.
    10. Okmyung Bin & Thomas W. Crawford & Jamie B. Kruse & Craig E. Landry, 2008. "Viewscapes and Flood Hazard: Coastal Housing Market Response to Amenities and Risk," Land Economics, University of Wisconsin Press, vol. 84(3), pages 434-448.
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    Citations

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    Cited by:

    1. vom Hofe, Rainer & Mihaescu, Oana & Boorn, Mary Lynne, 2017. "Do urban parks really benefit homeowners economically? Evidence from a spatial hedonic study of the Cincinnati park system," HUI Working Papers 122, HUI Research.
    2. Masha Maslianskaia-Pautrel & Catherine Baumont pba148, 2016. "The nature and impacts of environmental spillovers on housing prices: A spatial hedonic analysis," Working Papers 2016.04, FAERE - French Association of Environmental and Resource Economists.
    3. Walsh, Patrick & Griffiths, Charles & Guignet, Dennis & Klemick, Heather, 2017. "Modeling the Property Price Impact of Water Quality in 14 Chesapeake Bay Counties," Ecological Economics, Elsevier, vol. 135(C), pages 103-113.
    4. Landry, Craig E. & Whitehead, John C., 2015. "Economic Values of Coastal Erosion Management: Joint Estimation of Use and Passive Use Values with Recreation and Contingent Valuation Data," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205441, Agricultural and Applied Economics Association;Western Agricultural Economics Association.
    5. Paul Hindsley & Stuart Hamilton & O. Morgan, 2013. "Gulf Views: Toward a Better Understanding of Viewshed Scope in Hedonic Property Models," The Journal of Real Estate Finance and Economics, Springer, vol. 47(3), pages 489-505, October.
    6. repec:kap:enreec:v:67:y:2017:i:4:d:10.1007_s10640-016-0004-8 is not listed on IDEAS
    7. Alicia N. Rambaldi & K. Renuka Ganegodage & Cameron S. Fletcher & Felix Lipkin, 2014. "Inundation and Views in Coastal Residential Property Values. Does the Sale Price Reflect the Trade Off?," Discussion Papers Series 536, School of Economics, University of Queensland, Australia.
    8. repec:eee:ecoser:v:11:y:2015:i:c:p:128-139 is not listed on IDEAS
    9. Stephen Gibbons & Susana Mourato & Guilherme Resende, 2014. "The Amenity Value of English Nature: A Hedonic Price Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 57(2), pages 175-196, February.
    10. Jean-Sauveur Ay & Raja Chakir & Stephan Marette, 2014. "Does living close to a vineyard increase the willingness-to-pay for organic and local wine?," Working Papers 2014/03, INRA, Economie Publique.
    11. Mihaescu, Oana & vom Hofe, Rainer, 2013. "The Impact of Brownfields on Residential Property Values in Cincinnati, Ohio: A Spatial Hedonic Approach," HUI Working Papers 85, HUI Research.
    12. Leonardo Corral & Maja Schling & Cassandra Rogers & Janice Cumberbatch & Fabian Hinds & Naijun Zhou & Michele H. Lemay, 2016. "The Impact of Coastal Infrastructure Improvements on Economic Growth: Evidence from Barbados," IDB Publications (Working Papers) 95978, Inter-American Development Bank.
    13. repec:spr:envpol:v:20:y:2018:i:1:d:10.1007_s10018-017-0190-9 is not listed on IDEAS
    14. Leonardo Corral & Maja Schling & Cassandra Rogers & Janice Cumberbatch & Fabian Hinds & Naijun Zhou & Michele H. Lemay, 2016. "The Impact of Coastal Infrastructure Improvements on Economic Growth: Evidence from Barbados," IDB Publications (Working Papers) 7860, Inter-American Development Bank.
    15. repec:eee:jeeman:v:85:y:2017:i:c:p:62-80 is not listed on IDEAS
    16. Qiu, Yun & Gopalakrishnan, Sathya, 2016. "Defending the Shoreline: A Duration Model of Beach Re-Nourishment," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 236361, Agricultural and Applied Economics Association.

    More about this item

    JEL classification:

    • Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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