Do Homebuyers Care about the 'Quality' of Natural Habitats?
We study if homebuyers in Tucson, Arizona care about the condition of natural habitats and if they have preferences between natural and manmade habitats. Using field work data we examine whether homebuyers willingness to pay is influenced by the biological condition of the neighboring riparian habitat and how homebuyers value alternative manmade green areas, specifically golf courses. We also explore the relationship between the field data and remote sensing vegetation indices. The results of a hedonic analysis of houses that sold within 0.2 miles of 51 stratified-random selected riparian survey sites in Tucson, Arizona reveals that homebuyers significantly value habitat quality and negatively value manmade park-like features. Homebuyers are willing to pay twenty percent more to live near a riparian corridor that is densely vegetated and contains more shrub and tree species, particularly species that are dependent on perennial water flow. These environmental premiums are significant, outweighing structural factors such as an additional garage or swimming pool. Likewise, proximity to a riparian habitat with low biological quality or to a golf course lowers property values.
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