It’s The Smell: How Resolving Uncertainty about Local Disamenties Affects the Housing Market

Abstract: This study examines how the housing market responds to closing a major environmental disamenity nearby, particularly when the credibility of local policy is uncertain. Fresh Kills Landfill (NY) provides an empirical setting to examine this question across multiple distinct events with varying credibility signals. Results from a difference-in-differences analysis show that the market prices and volumes respond sharply to credible actions (i.e., capping the landfill and park transitioning) rather than policy announcements. The findings suggest resolving uncertainty can have a powerful supply effect for housing markets, applying downward pressure on prices in the short run, thereby overshadowing plausibly positive demand effects.

Recommended citation: Chen, J., Cornwall, G., & Scott Wentland. "Its The Smell: How Resolving Uncertainty about Local Disamenties Affects the Housing Market " Land Economics, Forthcoming.
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