An Empirical Investigation of Federal Wetlands Regulation and Flood Delineation: Implications for Residential Property Owners

Abstract

Since the early 1970s, the federal government has undertaken extensive efforts to stem the loss of wetlands by regulating the use of land. This paper investigates the extent to which residential property owners are affected by federal wetlands regulation, by presenting an empirical investigation of such economic consequences. Results suggest that because of the Supreme Court?s holding in United States v. Riverside Bayview Homes, Inc., sale prices of properties located in a wetlands area were discounted nearly eight percent, even after controlling for some sample properties being flood delineated.