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D'Agostino, John R.

Natural Resource Planning Program

2006

M.S.

This study examines the effects of floodplain location and proximity to beaches on property values in the New Jersey Coastal Area Facilities Review Act region of Middlesex, Monmouth and northern Ocean counties. Although past research has generally yielded price discounts for floodplain location expectant with market capitalization of hazard damage, a number of studies whose area of interest lay in close proximity to amenable water features found positive marginal effects while neglecting to incorporate these amenities into their respective models. This past omission is likely to have led to significant omitted variable bias and is important to internalize within a robust multivariate hedonic model. Of further importance is the paucity of studies examining disparate floodplain price effects for coastal wave action (VE) and inland riverine (A) flood zone sub-classifications. This marginal valuation assessment therefore assessed the implicit marginal price behavior of floodplain sub-classes within varying proximities of the New Jersey shoreline, finding that A-class flood zones are positively valued in our study region at ~$34,200 nearest the coastline, depreciating and becoming negative ~4 1/4 miles from the ocean. Conversely, VE flood zones exhibit a marginal -4.18% (-$11,625) price effect in our nearest-ocean beach zone that becomes a 32% ($88,826) premium beyond 500 ft. from the ocean.