Hedonic Analysis of the Impact of Flood Events on Residential Property Values in Malaysia: A Study of Willingness to Pay

IF 0.5 Q4 ECONOMICS

Malaysian Journal of Economic Studies Pub Date : 2019-06-10 DOI:10.22452/MJES.VOL56NO1.4

N. Ismail, M. Karim, B. Hasan-Basri

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引用次数: 4

Abstract

The effect of flooding on residential property values (RPV) is a major concern to all property buyers and owners. Although numerous studies have already discussed the risk of devaluation of those properties situated in flood prone areas, those that focused on the impact of flooding on residential properties in Malaysia are still limited. This paper extends existing literature by also estimating consumers’ willingness to pay for flood control measures to reduce the flood risk in Malaysia. Using the hedonic pricing model (HPM), our results suggest that the market value of urban and rural residential properties significantly decreases by 18.5 percent and 13.6 percent due to flooding, respectively. The result also shows that, respondents who are risk averse are willing to pay 35.4 percent more for flood control measures to reduce impact of flood risk compared to those who are risk takers. The results of this study can help property owners to understand the factors that contribute to property devaluation due to flooding. This study also proposes flood insurance programmes to be implemented as flooding is a major concern to real property owners.

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洪水事件对马来西亚住宅物业价值影响的分形分析：支付意愿研究

洪水对住宅物业价值的影响是所有购房者和业主关注的主要问题。尽管许多研究已经讨论了位于洪水易发地区的房产贬值的风险，但那些关注洪水对马来西亚住宅房产影响的研究仍然有限。本文通过估计消费者为降低马来西亚洪水风险的防洪措施付费的意愿，扩展了现有文献。使用特征定价模型（HPM），我们的结果表明，由于洪水，城市和农村住宅的市场价值分别显著下降了18.5%和13.6%。结果还显示，与风险承担者相比，厌恶风险的受访者愿意为防洪措施多支付35.4%的费用，以减少洪水风险的影响。这项研究的结果可以帮助业主了解洪水导致房产贬值的因素。这项研究还建议实施洪水保险计划，因为洪水是房地产所有者的主要担忧。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Malaysian Journal of Economic Studies ECONOMICS-

CiteScore

1.30

自引率

25.00%

发文量

期刊介绍： The primary purpose of the journal is to promote publications of original research related to the Malaysian economy. It is also designed to serve as an outlet for studies on the South-east Asian countries and the Asian region. The journal also considers high-quality works related to other regions that provide relevant policy lessons to Malaysia. The journal is receptive to papers in all areas of economics. We encourage specifically contributions on all range of economic topics of an applied or policy nature. At the same time, submissions of methodological or theoretical studies with results that are of practical use are welcome. Works that are interdisciplinary will be considered provided that they contain substantial economic contents.