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Article
Capitalized amenity value of urban wetlands: A hedonic property price approach to urban wetlands in Perth
Australian Journal of Agricultural and Resource Economics (2009)
  • Sorada Tapsuwan, CSIRO
  • Gordon Ingram, Curtin University of Technology
  • Michael Burton, University of Western Australia
  • Donna Brennan
Abstract
Up to 60 per cent of potable water supplied to Perth, Western Australia, is extracted from the groundwater system that lies below the northern part of the metropolitan area. Many of the urban wetlands are groundwater-dependent and excessive groundwater extraction and climate change have resulted in a decline in water levels in the wetlands. In order to inform decisions on conserving existing urban wetlands, it is beneficial to be able to estimate the economic value of the urban wetlands. Applying the Hedonic Property Price approach to value urban wetlands, we found that distance to the nearest wetland and the number of wetlands within 1.5 km of a property significantly influence house sales price. For a property that is 943 m away from the nearest wetland, which is the average distance to the wetland in this study, reducing the wetland distance by 1 m will increase the property price by AU$42.40. Similarly, the existence of an additional wetland within 1.5 km of the property will increase the sales price by AU$6976. For a randomly selected wetland, assuming a 20 ha isolated circular wetland surrounded by uniform density housing, the total sales premium to surrounding properties was estimated to be around AU$140 million (AU$40 million and AU$230 million).
Keywords
  • groundwater;hedonic;marginal implicit price;property price;revealed preference
Disciplines
Publication Date
2009
Citation Information
Sorada Tapsuwan, Gordon Ingram, Michael Burton and Donna Brennan. "Capitalized amenity value of urban wetlands: A hedonic property price approach to urban wetlands in Perth" Australian Journal of Agricultural and Resource Economics Vol. 53 Iss. 4 (2009)
Available at: http://works.bepress.com/sorada_tapsuwan/14/