The Influence of Leaking Underground Storage Tanks on Nearby House Values

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Hans R Isakson Mark D Ecker

Abstract

Some households are willing to pay a premium to live farther away from a disamenity, such as a neighborhood gas station with a leaking underground storage tank (LUST). In this study, submarkets are constructed to allow for this premium to be a function of both the distance to the nearest LUST and the intensity of multiple LUSTs. We find evidence that households within ¼ mile of multiple LUSTs do not have a statistically significant aversion to living near them. However, households more than a ¼ mile from a LUST are willing to pay 9.29% more for a house located 10% farther away. (Q51, Q53, R21)

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