How Hurricanes Sweep Up Housing Markets: Evidence from Florida

Joshua Graff Zivin, Yanjun Liao and Yann Panassie

No 27542, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper examines the impacts of hurricanes on the housing market and the associated implications for local population turnover. We first characterize the post-hurricane equilibrium dynamics in local housing markets using microdata from Florida during 2000-2016. Our results show that hurricanes cause an increase in equilibrium prices and a concurrent decrease in transactions in affected areas, both lasting up to three years. Together, these dynamics imply a negative transitory shock to the housing supply as a consequence of the hurricane. Furthermore, we match buyer characteristics from mortgage applications to provide the first buyer-level evidence on population turnover. We find that incoming homeowners in this period have higher incomes, leading to an overall shift in the local economic profile toward higher-income groups. Our findings suggest that market responses to destructive natural disasters can lead to uneven and lasting demographic changes in affected communities, even with a full recovery in physical capital.

JEL-codes: J10 Q54 R23 R31 (search for similar items in EconPapers)
Date: 2020-07
New Economics Papers: this item is included in nep-env and nep-ure
Note: EEE PE
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Citations: View citations in EconPapers (4)

Published as Graff Zivin, Joshua & Liao, Yanjun & Panassié, Yann, 2023. "How hurricanes sweep up housing markets: Evidence from Florida," Journal of Environmental Economics and Management, Elsevier, vol. 118(C).

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Journal Article: How hurricanes sweep up housing markets: Evidence from Florida (2023)
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