Measuring Price Effects from Disasters using Public Data: A Case Study of Hurricane Ian

Justin Contat, William Doerner, Robert Renner and Malcolm Rogers

No 24-04, FHFA Staff Working Papers from Federal Housing Finance Agency

Abstract: Natural disasters can disrupt housing markets, causing destruction to communities and distress to economic activity. To estimate the effects of disasters on home prices, publicly-available data on property damages are often used to classify "treated" properties. However, by design these data lack precise geospatial information, leading to measurement error in the treatment variable as aggregate measures must be used. We leverage leading difference-in-differences and synthetic control methodologies across various treatments and levels of geography to measure price effects with such data following Hurricane Ian's unexpected landfall in southwest Florida during September 2022, coinciding with the state's initial recovery from the COVID-19 pandemic. Empirical results suggest positive, time-varying price effects, though we place caveats on these results as there may be many mechanisms underway; our results should be interpreted as descriptive correlations and not causal effects for various reasons. Our main contribution is methodological, highlighting the importance of robustness checks, functional form, statistical techniques, and testing across different samples. Additionally, quicker access to high quality public data could enhance quantitatively-informed conversations on natural disaster effects.

Keywords: causal inference; hurricane; model selection; natural experiment; real estate valuation (search for similar items in EconPapers)
JEL-codes: C52 Q54 R21 R31 (search for similar items in EconPapers)
Pages: 59 pages
Date: 2024-05
New Economics Papers: this item is included in nep-env and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Forthcoming in Journal of Real Estate Research.

Downloads: (external link)
https://www.fhfa.gov/document/wp2404.pdf (application/pdf)
https://www.fhfa.gov/research/papers/wp2404 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hfa:wpaper:24-04

Access Statistics for this paper

More papers in FHFA Staff Working Papers from Federal Housing Finance Agency Contact information at EDIRC.
Bibliographic data for series maintained by William Doerner ().