Real estate pricing research provides evidence that properties potentially exposed to perceived or actual risks may experience price impacts. Looking Under the Hood reviews publications that illustrate the theoretical, methodological, and data challenges faced by scholars and practitioners studying detrimental conditions and their impacts on property values.
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Natural landscape views of any type have often been regarded as amenities. However, based on empirical evidence provided in the article titled, “Is What You See What You Get? The Value of Natural Landscape Views,” this assumption may have been incorrect. Moreover, Walls et al.[1] examined the impact of different types of natural landscape views on house prices in St. Louis, Missouri. The study area had undergone significant changes over the past 25 years, transitioning from farmland to other uses and experiencing substantial forest land expansion in the Meramec River area due to a greenway designation.
The researchers employed pooled and fixed effects hedonic price models using a comprehensive dataset of property sales that occurred from 1988 to 2011. The dataset comprised approximately 1,132,336 observations from the St. Louis County Revenue Department. To analyze the view data, advanced Geographic Information System (GIS) capabilities were utilized, and relevant information was sourced from the St. Louis County GIS Service Center.
The results of the property fixed-effect model revealed that proximity to green space had a positive impact on property values. However, the impact of different types of natural landscape views varied. Farmland views were considered amenities, as a 2% increase in property prices was observed when the farmland viewshed area increased by 10%. On the other hand, views of green space did not show any statistically significant impact on property values. One of the most intriguing findings of the study was related to views of forestland. Contrary to the assumption that natural landscape views are always beneficial, the study found that views of forestland had a small but statistically significant negative impact on property values.
In summary, the study provides valuable insights into the effects of different types of natural landscape views on property prices. While proximity to green space was associated with higher property values, farmland views were seen as amenities. Surprisingly, views of forestland led to a slight decrease in property values, challenging the traditional belief that all types of natural landscape views are universally beneficial.