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A platform for research: civil engineering, architecture and urbanism
Pricing Environmental Amenities and Climate Change Risks in Real Estate Market
https://orcid.org/http://orcid.org/0000-0002-9300-921X
https://orcid.org/http://orcid.org/0000-0003-0735-2159
https://orcid.org/http://orcid.org/0000-0003-3204-0595
Recent projections on sea level rise (SLR) show that approximately 32% and 22.62% of Lagos City will be inundated by 2100 and 2050, respectively. There are also few empirical estimates of the impact of such forecasts on the current price of residential real estates that are highly exposed to the SLR. In that regard, this study investigates the effects of proximity to the oceanfront and exposure to SLR on the current price of residential real estate in Lagos, a coastal city in Nigeria. The study employs a hedonic pricing model (HPM), and the results reveal three key findings. First, the results show that beachfront residential real estate sells at a 5.2% premium for every kilometre closer to the coastline. Second, the estimates show that residential real estate highly exposed to SLR sells at a 0.5% discount relative to a comparable unexposed property. Third, analysis indicates that Nigeria’s real estate market expects a 37-year window before a 1 km2 is completely underwater, rendering affected residential real estate worthless. Overall, these findings were interpreted as evidence that environmental amenities and climate risks are priced in Nigeria’s real estate market. Therefore, this study concludes that both climate change and proximity to the coast influence the current price of residential real estate in the coastal city of Lagos, Nigeria.
Pricing Environmental Amenities and Climate Change Risks in Real Estate Market
https://orcid.org/http://orcid.org/0000-0002-9300-921X
https://orcid.org/http://orcid.org/0000-0003-0735-2159
https://orcid.org/http://orcid.org/0000-0003-3204-0595
Recent projections on sea level rise (SLR) show that approximately 32% and 22.62% of Lagos City will be inundated by 2100 and 2050, respectively. There are also few empirical estimates of the impact of such forecasts on the current price of residential real estates that are highly exposed to the SLR. In that regard, this study investigates the effects of proximity to the oceanfront and exposure to SLR on the current price of residential real estate in Lagos, a coastal city in Nigeria. The study employs a hedonic pricing model (HPM), and the results reveal three key findings. First, the results show that beachfront residential real estate sells at a 5.2% premium for every kilometre closer to the coastline. Second, the estimates show that residential real estate highly exposed to SLR sells at a 0.5% discount relative to a comparable unexposed property. Third, analysis indicates that Nigeria’s real estate market expects a 37-year window before a 1 km2 is completely underwater, rendering affected residential real estate worthless. Overall, these findings were interpreted as evidence that environmental amenities and climate risks are priced in Nigeria’s real estate market. Therefore, this study concludes that both climate change and proximity to the coast influence the current price of residential real estate in the coastal city of Lagos, Nigeria.
Pricing Environmental Amenities and Climate Change Risks in Real Estate Market
https://orcid.org/http://orcid.org/0000-0002-9300-921X
https://orcid.org/http://orcid.org/0000-0003-0735-2159
https://orcid.org/http://orcid.org/0000-0003-3204-0595
Recent projections on sea level rise (SLR) show that approximately 32% and 22.62% of Lagos City will be inundated by 2100 and 2050, respectively. There are also few empirical estimates of the impact of such forecasts on the current price of residential real estates that are highly exposed to the SLR. In that regard, this study investigates the effects of proximity to the oceanfront and exposure to SLR on the current price of residential real estate in Lagos, a coastal city in Nigeria. The study employs a hedonic pricing model (HPM), and the results reveal three key findings. First, the results show that beachfront residential real estate sells at a 5.2% premium for every kilometre closer to the coastline. Second, the estimates show that residential real estate highly exposed to SLR sells at a 0.5% discount relative to a comparable unexposed property. Third, analysis indicates that Nigeria’s real estate market expects a 37-year window before a 1 km2 is completely underwater, rendering affected residential real estate worthless. Overall, these findings were interpreted as evidence that environmental amenities and climate risks are priced in Nigeria’s real estate market. Therefore, this study concludes that both climate change and proximity to the coast influence the current price of residential real estate in the coastal city of Lagos, Nigeria.
Pricing Environmental Amenities and Climate Change Risks in Real Estate Market
Environ Model Assess
Iliyasu, Jamilu (author) / Sanusi, Aliyu Rafindadi (author) / Mamman, Suleiman O. (author) / Abubakar, Yakubu (author)
Environmental Modeling & Assessment ; 28 ; 999-1010
2023-12-01
12 pages
Article (Journal)
Electronic Resource
English
Sea level rise; Climate change , Environmental amenities , Real estate market , Hedonic pricing model E31 , E44 , Y9 , Environment , Math. Appl. in Environmental Science , Mathematical Modeling and Industrial Mathematics , Operations Research/Decision Theory , Applications of Mathematics , Earth and Environmental Science
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