The Impact of Industrial Sites on Residential Property Values
Friso de Vor and
Henri de Groot ()
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Friso de Vor: VU University Amsterdam
No 09-035/3, Tinbergen Institute Discussion Papers from Tinbergen Institute
This discussion paper resulted in a publication in 'Regional Studies' 45(5), 609-23. Industrial sites cause several negative externalities, such as traffic noise disturbance, congestion, and obstruction of view. In order to quantify the negative effects stemming from industrial sites, we estimate – using a hedonic pricing model – the impact of distance to industrial sites on residential property values. We use data on houses sold in the Randstad region and the province of Noord-Brabant (both located in the Netherlands) in the year 2005, together with data on characteristics of a substantial number of industrial sites in the same regions and period. The results reveal that the distance to an industrial site has a statistically significant negative effect on the value of residential properties. However, the effect is largely localized within a relatively short distance from the nearest industrial site. Furthermore, we obtain statistical evidence for substantial localized price differentials, which vary according to the size of an industrial site.
Keywords: industrial sites; negative externalities; hedonic pricing (search for similar items in EconPapers)
JEL-codes: O18 R30 R52 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20090035
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