Timing of Stormwater Pond Construction and Its Impact on Property Values: A Hedonic Analysis in South Carolina

Abstract

Stormwater practices are mainly built to reduce flooding, but recent studies showed they could also be an amenity to residential developments. The literature shows conflicting results on the property value effects of stormwater practices. When not properly maintained and deemed less desirable, they could serve as a disamenity to surrounding property owners. To understand how residential wet detention ponds affect the property values of single-family homes, we used a hedonic price method to analyze the real estate data of coastal districts of Horry County in South Carolina. Results showed that adjacency to a stormwater pond generates a premium for single-family homes, although homeowners pay a lower premium when the pond is constructed. Also, newly built homes, particularly presold or less than 2 years old and bought by first owners, command higher prices when near a residential pond. The findings of this study highlight the importance of optimizing stormwater pond designs that deliver the highest benefit to the community.