A big dilemma: Airport noise and property value

Abstract

Even though many attributes to the airport creates value for properties, many other factors such as noise is considered to have wither neutral or negative effects residential property values. This research examines the relationship between airport noise and housing prices by using disaggregated transactions in Dallas-Fort Worth Airport which is the fourth busiest airport in the United States (FAA, 2015). The effects of airports on residential property values have been studied in several fields and contexts. Tomkins et al. (1998) examined the Manchester Airport by performing hedonic method. In addition, Nelson conducted a meta-analysis about noise and housing price near airport and these studies applied census tract aggregated data. This paper examined the implications of the airport noise on disaggregated residential property transactions in a rapid growing urban area—Dallas Fort Worth Metropolitan- by performing Multi-Level-Modeling. To do this, variables are defined for each level. Property level is considered with many characteristics such as number of bedrooms, bathrooms, floor, etc. Moreover, there are also neighborhood attributes such as demographics, income, and green space to evaluate. Based on results, total and marginal benefits of noise reduction were estimated that a 1 dB noise reduction may lead to increase 0.6% of house values.