Jack Staton
ABSTRACT
Climate-related hazards, such as floods, threaten housing markets and infrastructure globally. This study explores the intricate relationship between flood risk, property values, and corporate ownership. The interplay of these factors is critical for individual property owners and broader economic stability and urban planning. Key questions include: Is there a relationship between flood risk and appraised property value? Is there a relationship between corporate ownership and appraised property value? Does an interaction between flood risk and corporate ownership affect the average appraised property value? Is there a meaningful difference in these relationships and interactions between 2022 and 2023? Using a hedonic pricing analysis and 2022 and 2023 Broward County, Florida property data from the Broward County Appraiser’s Office, the study determined an associated decrease of approximately 5.5% in 2022 and 5.1% in 2023 in the property value of high flood-risk properties. The analysis also determined that for properties owned by a corporate entity, there was an associated decrease of approximately 3.6% in 2022 and 3.1% in 2023 in the property value, indicating that holding other variables constant, corporate-owned properties are typically associated with lower values. Finally, there was an associated increase of approximately 10.2% in 2022 and 9.6% in 2023 in property values for properties that are both high flood risk and owned by a corporate entity. This indicates that, controlling for the other variables in the model, high flood-risk properties owned by a business appear to have appreciably higher property values on average.
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