The effect of food centers on property values under conditions of climate change in an island economy

This study focuses on the impacts of food centers (supermarkets, grocery stores, and farmer's markets) on property values under conditions of climate change. This study carries out a difference-in-difference hedonic pricing model to assess how single-family and condo residential property values are impacted by their proximity to food centers. The sample includes 32,074 single-family housing sales transactions and 47,625 condo sales transactions from 2006 to 2015. The key findings of the study are: (1) the food centers are often clustered along the coast, especially in the special management areas (SMAs) which are very sensitive to the climate change on Oahu. (2) There is a positive distance spillover impact from farmers’ markets: for single-family houses located one mile closer to one farmer’s market, the housing prices rise by 6%; there is a negative distance spillover impact from the supermarket: in particular, housing prices drop by 1.7% for single-family houses located one mile closer to one supermarket; there is a negative distance spillover impact from the grocery stores: in particular, housing prices drop by 3.2% for single-family houses located one mile closer to one grocery store. (4) There is a positive distance spillover impact from the farmers’ market: for condos located one mile closer to a farmer’s market the price increases by 9%; there is a also a positive distance spillover impact from the supermarkets on condos: for condos located one mile closer to one supermarket, prices increases by 11.6%; finally, there is a negative distance spillover impact from the grocery stores: condo prices drop by 4.4% for condos located one mile closer to one grocery store. (5) Both the single family house owners and condo owners regard the farmer’s market as an amenity and grocery stores as a disamenity. The results indicate that farmer’s markets help to increase sustainabability, resilience and property values for the residents on Oahu. This is particularly important under conditions of climate change given the importance of food security and independence in an isolated island economy.