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The Aftermath of Flood Zone Remapping: The Asymmetric Impact of Flood Maps on Housing Prices

The Aftermath of Flood Zone Remapping: The Asymmetric Impact of Flood Maps on Housing Prices <p>ABSTRACT:</p><p>We propose a theoretical framework characterizing (1) the attenuation of flood risks revealed by the flood zone designation in flood insurance rate maps and (2) the asymmetric impacts of adding versus removing flood zone status on property values. We apply spatial fixed effects models to empirically investigate the impacts of flood zone status and test the proposed theory. The results indicate that housing values decrease by more than 11% when a property is assigned into a flood zone. However, property values do not rebound when flood zone status is removed. <i>(JEL Q51)</i></p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Land Economics University of Wisconsin Press

The Aftermath of Flood Zone Remapping: The Asymmetric Impact of Flood Maps on Housing Prices

Land Economics , Volume 95 (2) – Apr 11, 2019

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Publisher
University of Wisconsin Press
Copyright
Copyright by the Board of Regents of the University of Wisconsin System.
ISSN
1543-8325

Abstract

<p>ABSTRACT:</p><p>We propose a theoretical framework characterizing (1) the attenuation of flood risks revealed by the flood zone designation in flood insurance rate maps and (2) the asymmetric impacts of adding versus removing flood zone status on property values. We apply spatial fixed effects models to empirically investigate the impacts of flood zone status and test the proposed theory. The results indicate that housing values decrease by more than 11% when a property is assigned into a flood zone. However, property values do not rebound when flood zone status is removed. <i>(JEL Q51)</i></p>

Journal

Land EconomicsUniversity of Wisconsin Press

Published: Apr 11, 2019

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