TY - JOUR

T1 - Modelling Coastal Externalities Effects on Residential Housing Values

AU - Ayoola, Adeyosoye Babatunde

AU - Oladapo, Adejoke Rashidat

AU - Ojo, Babajide

AU - Oyetunji, Abiodun Kolawole

PY - 2023/11/27

Y1 - 2023/11/27

N2 - Purpose: This paper aims to examine the impact of coastline on the rental value of residential property in proximity to the coastline, using the hedonic pricing model from two perspectives. First, Model 1A–C accounted for estimating the influence of coastal amenities while controlling for other housing attributes influencing rent. Second, Model 2A–C accounted for the interaction between coastal amenities/disamenities and other housing attributes influencing rent. Design/methodology/approach: A survey approach was adopted for the data collection process. For both models, property values were measured in proximity to coastline using 0–250 m, 251–500 m and 0–500 m. Findings: Findings revealed that property rental value increases as we move away from the coastline when disamenities are not controlled. The results suggested that for a mean-priced home (N2,941,029 or $8,170) at the mean distance from the coastline (301.83 m), a 1% increase in distance from the coastline would result in a 0.001% or N9.77 (Findings: Findings revealed that property rental value increases as we move away from the coastline when disamenities are not controlled. The results suggested that for a mean-priced home (N2,941,029 or $8,170) at the mean distance from the coastline (301.83 m), a 1% increase in distance from the coastline would result in a 0.001% or N9.77 ($0.03) increase in rental value.03) increase in rental value. Practical implications: The implication to real estate valuers is that varying premiums should be considered when valuing a property depending on the distance to the coastline while considering other housing attributes. Originality/value: This research introduces a novel approach to the hedonic model for determining property values in proximity to coastal environment by estimating the influence of coastal amenities while controlling for other housing attributes influencing rent, on the one hand, and accounting for the interaction between coastal amenities/disamenities and other housing attributes influencing rent, on the other.

AB - Purpose: This paper aims to examine the impact of coastline on the rental value of residential property in proximity to the coastline, using the hedonic pricing model from two perspectives. First, Model 1A–C accounted for estimating the influence of coastal amenities while controlling for other housing attributes influencing rent. Second, Model 2A–C accounted for the interaction between coastal amenities/disamenities and other housing attributes influencing rent. Design/methodology/approach: A survey approach was adopted for the data collection process. For both models, property values were measured in proximity to coastline using 0–250 m, 251–500 m and 0–500 m. Findings: Findings revealed that property rental value increases as we move away from the coastline when disamenities are not controlled. The results suggested that for a mean-priced home (N2,941,029 or $8,170) at the mean distance from the coastline (301.83 m), a 1% increase in distance from the coastline would result in a 0.001% or N9.77 (Findings: Findings revealed that property rental value increases as we move away from the coastline when disamenities are not controlled. The results suggested that for a mean-priced home (N2,941,029 or $8,170) at the mean distance from the coastline (301.83 m), a 1% increase in distance from the coastline would result in a 0.001% or N9.77 ($0.03) increase in rental value.03) increase in rental value. Practical implications: The implication to real estate valuers is that varying premiums should be considered when valuing a property depending on the distance to the coastline while considering other housing attributes. Originality/value: This research introduces a novel approach to the hedonic model for determining property values in proximity to coastal environment by estimating the influence of coastal amenities while controlling for other housing attributes influencing rent, on the one hand, and accounting for the interaction between coastal amenities/disamenities and other housing attributes influencing rent, on the other.

KW - Coastline

KW - Flood

KW - Housing

KW - Properties

KW - Rent

KW - Residential

U2 - 10.1108/IJHMA-05-2022-0071

DO - 10.1108/IJHMA-05-2022-0071

M3 - Journal article

VL - 16

SP - 1193

EP - 1210

JO - International Journal of Housing Markets and Analysis

JF - International Journal of Housing Markets and Analysis

SN - 1753-8270

IS - 6

ER -