Are Environmental Hazards Lowering Your Home's Value?
You may be well versed in the factors that can improve your home’s value, like adding on a bathroom, installing energy-efficient appliances or putting on a new roof. But are you aware that certain environmental hazards, such as poor air quality can actually detract from your home’s value?
Research from ATTOM Data Solutions Environmental Hazards Housing Risk Index shows that 17.3 million single-family homes and condominiums are at high risk of an environmental hazard, such as brownfields, or property potentially contaminated by a hazardous substance, polluters, poor air quality and superfunds.
"Home values are higher and long-term home price appreciation is stronger in zip codes without a high risk for any of the four environmental hazards analyzed," says Daren Blomquist, senior vice president at ATTOM Data Solutions.
ATTOM details how home values have been affected by each of these environmental hazards:
- In areas with a "very high" brownfield risk - areas previously used for commercial development which may now have environmental contamination - 17.2 percent of properties are "seriously underwater," according to the Index; in areas with a "very low" brownfield risk, 8.9 percent of properties are seriously underwater. Median home prices in very high brownfield risk areas are 2.8 percent below 10 years prior, while median home prices in very low brownfield risk areas are 2.8 percent above 10 years prior. Home sellers in very high brownfield risk areas gained 25.3 percent on average at sale, while sellers in very low brownfield risk areas gained 18.9 percent.
- In areas with a very high polluter risk, 12.7 percent of properties are seriously underwater, compared to 9.2 percent of properties seriously underwater in very low polluter risk areas. Home sellers in very high polluter risk areas gained 16.6 percent on average at sale, while sellers in very low polluter risk areas gained 27.7 percent.
- For areas with a "low" or "moderate" risk of poor air quality, home sales volume has increased 26 percent in the past five years, according to the report; for areas with a "high" risk of poor air quality, home sales volume has increased 16.5 percent in the past five years, while in areas with a very high risk of poor air quality, home sales volume has increased 3.3 percent over the past five years.
- Median home prices in very high superfund risk areas - a U.S. federal program designed to fund the cleanup of sites contaminated with hazardous substances and pollutants - are 1.5 percent below 10 years prior. Home sellers in high superfund risk areas gained 19.6 percent on average at sale, while sellers in very low superfund risk areas gained 24.4 percent.
Source: ATTOM Data Solutions