Print Email Facebook Twitter Capitalized value of evolving flood risks discount and nature-based solution premiums on property prices Title Capitalized value of evolving flood risks discount and nature-based solution premiums on property prices Author Mutlu, A. (TU Delft Policy Analysis) Roy, Debraj (Universiteit van Amsterdam) Filatova, T. (TU Delft Policy Analysis) Date 2023 Abstract Nature-based solutions (NbS) are a cornerstone of climate change adaptation worldwide. Yet, evidence on their economic benefits is scarce, especially since the provided environmental amenities usually spatially correlate with climate-induced hazards, effects of which NbS aim to curb. This lack of empirical evidence creates obscurity regarding social acceptability of NS, hindering their uptake and upscaling. We apply hedonic price models to estimate homeowners' willingness-to-pay for NbS (like flood safety, environmental benefits), while controlling for spatio-temporal changes in capitalized flood risk discounts due to the 1993-1995 floods in the Limburg Province, the Netherlands. We reveal a pre-flood effect of 5.6% (discounting on average -€12,753 for flood-prone properties), which rises to 10.9% (−€24,691 on average) immediately after the floods. However, the effect is only transitory. The flood discount of home values price discount diminishes over time and eventually vanishes in 9–12 years, which coincides with the implementation of the largest and oldest NbS intervention in the Netherlands. Our analysis shows that NbS amenities provide a 15% (€33,687 on average) premium to nearby residential property prices. This evidence of the evolving flood risk discount and the stable NbS premium for individual homeowners could support the economic feasibility and wide acceptability of NbS for climate change adaptations. Subject Flood RiskHedonic Price MethodNature-based solutionsProperty Value To reference this document use: http://resolver.tudelft.nl/uuid:f17601be-b162-4b06-94f1-9c1f683ea7d6 DOI https://doi.org/10.1016/j.ecolecon.2022.107682 ISSN 0921-8009 Source Ecological Economics, 205 Part of collection Institutional Repository Document type journal article Rights © 2023 A. Mutlu, Debraj Roy, T. Filatova Files PDF 1_s2.0_S0921800922003433_main.pdf 5.71 MB Close viewer /islandora/object/uuid:f17601be-b162-4b06-94f1-9c1f683ea7d6/datastream/OBJ/view