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The Property Value Impacts of Groundwater Contamination: Agricultural Runoff and Private Wells

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  • Guignet, Dennis
  • Northcutt, Rachel
  • Walsh, Patrick

Abstract

There are few studies examining the impacts of groundwater quality on residential property values. Using a unique dataset of groundwater well tests, we link residential transactions to home-specific contamination levels and undertake a hedonic analysis of homes in Lake County, Florida; where groundwater pollution concerns stem primarily from agricultural runoff. We find that testing and contamination yield a 2% to 6% depreciation, an effect that diminishes after the situation is resolved. Focusing specifically on nitrogen-based contamination, we find prices decline mainly at concentrations above the regulatory health standard, suggesting up to a 15% deprecation at levels twice the standard.

Suggested Citation

  • Guignet, Dennis & Northcutt, Rachel & Walsh, Patrick, 2015. "The Property Value Impacts of Groundwater Contamination: Agricultural Runoff and Private Wells," National Center for Environmental Economics-NCEE Working Papers 280928, United States Environmental Protection Agency (EPA).
    • Handle: RePEc:ags:nceewp:280928
    DOI: 10.22004/ag.econ.280928
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    1. Anna Alberini, 2017. "Measuring the economic value of the effects of chemicals on ecological systems and human health," OECD Environment Working Papers 116, OECD Publishing.

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    More about this item

    Keywords

    Environmental Economics and Policy; Resource/Energy Economics and Policy;

    JEL classification:

    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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