The Impact of Water Clarity on Home Prices in Vilas and Oneida Counties, Wisconsin : A Hedonic Study
Date
2019-05Author
Zhou, Sisi
Wu, Shangqian
Roehl, Megan
Winkler, Eric
Kemp, Thomas
Metadata
Show full item recordAbstract
This study estimates the residential property value gains associated with improvements in water clarity on 60 Northern Wisconsin lakes. Using a two-stage hedonic model applied to Wisconsin DNR water clarity data and data associated with 271 residential home sales obtained from Zillow.com and County property records. We conclude that a one (1) meter improvement in water clarity would produce a $8,090.87 – $32,171.12 improvement in the market price of an average residential property on a lake within the study area. We also conclude that in addition to water clarity the main non-housing attributes that drive property value in the region are the local tax rate and the distance to a public airport. There exist a significant number of lakes in Northern Wisconsin that exhibit low levels of water clarity. It is also a well-established fact that perceptions of water quality and water clarity have a significant bearing upon residential property values. It is the case that an improvement in water clarity on those lakes that currently exhibit low clarity would result in a significant improvement in property values. (Not to mention a number of other economic benefits – such as increased tourism.) Rising property values also means increased property valuations and – potentially – State and local tax revenue. On the other hand, improving water clarity is not without costs. The matter is therefore a balancing act: In cases where the economic benefits exceed the costs associated with water clarity improvement there is a clear case to be made for said improvements.
Subject
Water clarity
Property values
Lakes
Posters
Department of Economics
Permanent Link
http://digital.library.wisc.edu/1793/81436Description
Color poster with text, charts, and maps.