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Study: Factory farms trigger property value declines

posted on August 22, 2003


Hello, I'm Mark Pearson.

Is the economy gathering steam? There were more indications this week that may be the case.

The Conference Board's index of leading indicators jumped in July, spurred by advances in the interest rate spread, money supply and stock prices.

New housing construction shot to a 17-year high in July, despite higher mortgage rates. And, the number of first-time claims for jobless benefits fell to the lowest level in six months.

Those reports had the equities markets feeling good. The NASDAQ, for instance, is at a 16-month high.

In the country, wealth and value often are measured in more real terms, such as property. But according to a new study, even that may be changing.

 

Study: Factory farms trigger property value declines

A new academic study found factory farms can drive down nearby property values, in some cases by as much as 11 percent. Data for the Iowa State University study was collected from property sales in five Iowa counties that have large concentrations of livestock lots.

The study found that the closer properties are located to large confinement operations, the greater the effect on land values. A property's location in regard to routine wind directions also had an impact.

For instance, properties within a quarter-mile of the nearest factory farm and downwind from the northwest can see a decrease in value of 11 percent. Properties within a quarter-mile and downwind from the south can see a drop of 7 percent. At a distance of 1.5 miles, those declines fall to 3 and 2 percent.

The study by the university's Center for Agricultural and Rural Development concluded odors were the primary cause for a decrease in nearby values. The center's director noted that if a livestock lot is downwind, "the only thing that travels by wind is odor."

The conclusions drawn in the study, which examined property sales between the mid 90s and 2002, were similar to those found in an earlier study by North Carolina State University.

 


Tags: agriculture farms money news real estate