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Is Wal-Mart a bad neighbor? Repeat sales evidence on how property values react to a new big-box store

by Lybecker, Kristina M., Johnson, Daniel K. N.

Abstract

While there is anecdotal evidence that home values decline when a big-box store (such as Wal-Mart) decides to locate in the area, there is a paucity of evidence on that effect. This paper uses a repeat sales model to compare residential property values, and the speed of sale of the property, to compare the impact that an arrival has. Results conclude that there is a "news effect" surrounding the arrival, and that the total effect is small at most. For most specifications tested, the number of stores nearby, the arrival of new stores, and the distance to the nearest store all have insignificant impacts on both property resale value and the number of days that a property spends on the market prior to sale. In the worst-case scenario, the arrival of a Wal-Mart is associated with a decline equivalent to roughly one percent of the home's square footage and is not absorbed by those closest to the new retailer but by rather more distant neighbors.

Note

Acquired from Department of Economics and Business. Saved as PDF/A1.b using Adobe Acrobat Professional.

Includes bibliographical references.

Administrative Notes

Acquired from Department of Economics and Business. Saved as PDF/A1.b using Adobe Acrobat Professional.

Copyright
Copyright restrictions apply. Contact the author for permission to publish.
Publisher
None
PID
coccc:3331
Digital Origin
born digital
Extent
25 pages : illustrations