Wireless Towers and Home Values: An Alternative Valuation Approach Using a Spatial Econometric Analysis
This is the first study to use an hedonic spatial autoregressive model to assess the impact of wireless communication towers on the value of residential properties. Using quantile analyses based on minimum distances between sold properties and visible and non-visible towers, we examine the relationship between property values and wireless tower proximity and visibility within various specified radii for homes sold after tower construction. For properties located within 0.72 kilometers of the closest tower, results reveal significant social welfare costs with values declining 2.46% on average, and up to 9.78% for homes within tower visibility range compared to homes outside tower visibility range; in aggregate, properties within the 0.72-kilometer band lose over $24 million dollars.
KeywordsHedonic analysis Housing value Land planning Public planning Spatial econometrics Urban externalities Wireless tower impacts
JEL ClassificationsC5 K32 Q51 R21 R32 R38 R58
- Airwave Management, LLC (2013). Cell tower lease rates exposed. http://www.cell-tower-leases.com/Cell-Tower-Lease-Rates.html. Accessed 6 March 2016.
- Bond, S. (2007b). The Effect of Distance to Cell Phone Towers on House Prices in Florida. The Appraisal Journal, 75(4), 362–370.Google Scholar
- Bond, S., & Wang, K. K. (2005). The impact of cell phone towers on house prices in residential neighborhoods. The Appraisal Journal, 73(3), 256–262.Google Scholar
- Centers for Disease Control and Prevention (2015) CDC data predicts death of landline home phones. http://siliconangle.com/blog/2015/02/25/cdc-data-predicts-death-of-landline-home-phones. Accessed 5 March 2016.
- Cisco (2013). VNI mobile forecast highlights, 2013–2018, United States – 2013 Year in Review. http://cisco.com/assets/sol/sp/vni/forecast_highlights_mobile. Accessed 2 March 2016.
- CTIA - The Wireless Association® (2015). Annual Wireless Industry Survey. http://ctia.org/your-wireless-life/how-wireless-works/annual-wireless-industry-survey. Accessed 6 Feb 2017.
- Entner, R. (2012). The Wireless Industry: The Essential Engine of U.S. Economic Growth. Recon Analytics, May, 30–33.Google Scholar
- Federal Communications Commission (1996). Telecommunications Act of 1996. https://transition.fcc.gov/telecom.html. Accessed 10 April 2016.
- Florax, R. J., & De Graaff, T. (2004). The performance of diagnostic tests for spatial dependence in linear regression models: a meta-analysis of simulation studies (pp. 29–65). Berlin-Heidelberg: Advances in Spatial Econometrics, Springer.Google Scholar
- LeSage, J., & Pace, R. K. (2009). Introduction to spatial econometrics. Boca Raton: CRC Press.Google Scholar
- Mahan, B. L., Polasky, S., & Adams, R. M. (2000). Valuing urban wetlands: a property price approach. Land Economics, 76(1), 100–113.Google Scholar
- Martin, S. L. (1997). Communications tower Sitings: the telecommunications act of 1996 and the battle for community control. Berkeley Technology Law Journal, 12(2), 483–501.Google Scholar
- McDonough, C. C. (2003). The impact of wireless towers on residential property values. Assessment Journal, 10(3), 25–32.Google Scholar
- Nelson, A.C., & McCleskey, S.J. (1990). Improving the effects of elevated transit stations on neighborhoods. Transportation Research Record (1266), 173–180.Google Scholar
- Pearce, A.P., Carlson, J.R. & Pagano, M. (2013). Wireless broadband infrastructure: catalyst for GDP and job growth 2013-2017. http://apps.fcc.gov/ecfs/document/view?id=7520949630. Accessed 6 March 2016.
- Summers, L. (2010). Technological opportunities, job creation, and economic growth. Remarks at the New America Foundation, June 29, 2010. http://larrysummers.com/wpcontent/uploads/2015/07/Technological-Opportunities_6.28.2010.pdf. Accessed 4 March 2016.
- United Nations, International Communication Union (2015). ICT Facts and Figures. http://www.itu.int/en/ITU-D/Statistics/Pages/facts/default.aspx. Accessed 11 April 2016.