Estimating the Impacts of Brownfield Remediation on Housing Property Values

The U.S. Environmental Protection Agency Brownfields Program provides grants to assess and clean up brownfields — properties the "expansion, re-development, or re-use of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant." The highly localized nature of brownfields lends itself well to measuring the value of site remediation with property value hedonics. The application of that technique is, however, complicated by the presence of correlated unobservable determinants of housing prices (both time-invariant and those that vary over time). This report uses a variety of quasi-experimental techniques to overcome this problem. The analysis finds evidence of large increases in property values accompanying cleanup, ranging from 5.1% to 12.8%; a double-difference matching estimator that does not rely on the intertemporal stability of the hedonic price function finds even larger effects, implying that evidence of property value increases is consistent with a willingness to pay interpretation