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Thread: Property value loss studies

  1. #1
    Cyburbian Budgie's avatar
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    Property value loss studies

    Alright, in the planning field it has always been assumed that industrial uses, warehouse uses, mini-storage, commercial uses and the like have a negative impact on property values. Has this not been a given in land use planning and implied in state statutes regarding land use.

    OK, my City Attorney informed me that the Planning Commission can not make a finding of diminished property values (mini-storage next to residential) without studies backing up the finding.

    So, I need studies, studies and more studies. I'll do a little websearch and any links would be helpful from yall. If you have hardcopies, PM me. Perhaps we need an on-line file cabinet with studies indexed to uses. HMMMM !!! I've got over a dozen on SOB's to contribute.
    "And all this terrible change had come about because he had ceased to believe himself and had taken to believing others. " - Leo Tolstoy

  2. #2
    Cyburbian The One's avatar
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    Yup....

    Quote Originally posted by Budgie
    Alright, in the planning field it has always been assumed that industrial uses, warehouse uses, mini-storage, commercial uses and the like have a negative impact on property values. Has this not been a given in land use planning and implied in state statutes regarding land use.

    OK, my City Attorney informed me that the Planning Commission can not make a finding of diminished property values (mini-storage next to residential) without studies backing up the finding.

    So, I need studies, studies and more studies. I'll do a little websearch and any links would be helpful from yall. If you have hardcopies, PM me. Perhaps we need an on-line file cabinet with studies indexed to uses. HMMMM !!! I've got over a dozen on SOB's to contribute.
    I've got about 30 studies in the back of my van on SOB's....too lazy to get rid of them and haven't needed the space lately.....(time to clean em out...) There was an appraiser out of California who is widely considered to be an EXPERT on the topic of diminished property values and wrote the book on the subject.....I can't seem to find the paper I was saving to by the book......you should be able to find it fairly quickly online and or through ULI. I spoke to his co-author about our issues and several other appraisers throughout the nation (all agreed that this guy was the best and wrote the book on this issue...) Talk about memory loss, I can't for the life of me remember his name (it was over a year ago now, and we didn't move forward with our program).... I'll keep looking though......

    Bottom line in hot markets (like SE Florida), it will be difficult if not impossible to show diminished value because of the scarcity of buildable lands. Kansas and other places with a much more well defined (skinny) profit margin on property sales could benefit from this mystery book I'm recommending.....
    “The way of acquiescence leads to moral and spiritual suicide. The way of violence leads to bitterness in the survivors and brutality in the destroyers. But, the way of non-violence leads to redemption and the creation of the beloved community.”
    Dr. Martin Luther King, Jr.
    - See more at: http://www.thekingcenter.org/king-ph....r7W02j3S.dpuf

  3. #3
    Cyburbian Rumpy Tunanator's avatar
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    Quote Originally posted by Budgie
    Alright, in the planning field it has always been assumed that industrial uses, warehouse uses, mini-storage, commercial uses and the like have a negative impact on property values. Has this not been a given in land use planning and implied in state statutes regarding land use.
    Keep in mind, commercial and industrial uses pay more in taxes and have less strain on schools or other infrastructure as residential uses. But then again there is a catch 22 with everything.

    Although I agree that a commercial or industrial use next to a residential use might (or might as well, seeing how it will) bring down the value of the residential area though.
    A guy once told me, "Do not have any attachments, do not have anything in your life you are not willing to walk out on in 30 seconds flat if you spot the heat around the corner."


    Neil McCauley (Robert DeNiro): Heat 1995

  4. #4
    A study showing that industrial use lowers property values is going to be worthless unless it explains why it did. If property values are lower because the building is an eyesore, that has nothing to do with usage. An eyesore house or an eyesore school would also lower property value.

  5. #5
    Cyburbian Budgie's avatar
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    Quote Originally posted by jaws
    A study showing that industrial use lowers property values is going to be worthless unless it explains why it did.
    Agreed. I've found a couple at the Journal of Real Estate website that explore the reduction of residential property values, but most have been related to preception and liability relating to contaminated (or potetially contaminated) sites such as superfund sites and sites with underground storage tanks.

    I'll keep looking. Are there any studies that address negative asthetic externalities? I've seen some on positive asthetic externalities, such as the impact of a "great view" on residential property values.
    "And all this terrible change had come about because he had ceased to believe himself and had taken to believing others. " - Leo Tolstoy

  6. #6
    Cyburbian The One's avatar
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    Here it is.....

    This is the web site I was talking about:

    http://www.bellconsulting.com/

    and the book (many others at the web site):

    REAL ESTATE DAMAGES:
    An Analysis of Detrimental Conditions

    By Randall Bell

    Published by Appraisal Institute, Chicago
    ISBN: 0922154554

    Budgie: This guy has to be the #1 Expert in the nation on the diminished value issue (my opinion, but all you have to do is read his work and scan his ideas to get from A to B) Check out Classification VI on his scale:

    http://www.realestatedamages.com/Art...Conditions.pdf
    “The way of acquiescence leads to moral and spiritual suicide. The way of violence leads to bitterness in the survivors and brutality in the destroyers. But, the way of non-violence leads to redemption and the creation of the beloved community.”
    Dr. Martin Luther King, Jr.
    - See more at: http://www.thekingcenter.org/king-ph....r7W02j3S.dpuf

  7. #7

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    Search the journal Land Economics. Over the years it has published qutite a few analyses of the impact (or lack thereof) of various uses on adjoining property values.

  8. #8
    Cyburbian The One's avatar
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    Try this one....

    Quote Originally posted by Lee Nellis
    Search the journal Land Economics. Over the years it has published qutite a few analyses of the impact (or lack thereof) of various uses on adjoining property values.
    Go to this web site:
    Welcome to the largest bibliographic database dedicated to Economics and available freely on the Internet. Over 325'000 items of research can be browsed or searched, and over 225'000 can be downloaded in full text! This site is part of a large volunteer effort to enhance the free dissemination of research in Economics, RePEc. To see the popularity of these services, browse the statistics at LogEc

    http://ideas.repec.org/

    I found this abstract:

    Author Info
    Steven C. Bourassa (School of Urban and Public Affairs, University of Louisville)
    Martin Hoesli (HEC-University of Geneva, FAME and University of Aberdeen Business School)
    Jian Sun (School of Urban and Public Affairs, University of Louisville)
    Abstract

    The impact of views on property values has not been the specific focus of as much research as has the impact of other externalities on property values. When the impact of views is assessed, it is usually done by adding a single dummy variable to a hedonic regression equation. This paper provides a detailed literature review as well as an empirical analysis of the impact of a view on residential property values using a very rich database of nearly 5,000 sales in Auckland, New Zealand. Several dimensions of a view are analyzed: type of view, scope of view, distance to coast, appearance of immediately surrounding improvements, average quality of landscaping in the neighborhood, and average quality of structures in the neighborhood. It is found that wide views of water add an average of 59% to the value of a waterfront property, but that this effect diminishes quite rapidly as the distance from the coast increases. Attractive buildings in a property’s neighborhood on average add 37% to value relative to properties in neighborhoods with only average quality structures. Particularly attractive improvements in the immediate surroundings of a property add another 27% to value on average. On the other hand, properties in neighborhoods with only poor quality landscaping on average experience a -51% impact on price. Our results lead to the conclusion that aesthetic externalities are multi-dimensional and can have a substantial impact on residential property values.
    Download Info
    To download:

    If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.fame.ch/library/EN/RP79.pdf
    File Format:
    File Function:
    Download Restriction: no

    Contact the author for a bibliography or list of references for additional info.

    GOOD LUCK

    TO strikes again with (I hope) useful info
    Last edited by The One; 16 Aug 2005 at 1:32 PM.
    “The way of acquiescence leads to moral and spiritual suicide. The way of violence leads to bitterness in the survivors and brutality in the destroyers. But, the way of non-violence leads to redemption and the creation of the beloved community.”
    Dr. Martin Luther King, Jr.
    - See more at: http://www.thekingcenter.org/king-ph....r7W02j3S.dpuf

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