The Value of a Healthy Home: Lead Paint Remediation and Housing Values

Abstract

The presence of lead paint significantly impairs cognitive and behavioral development, yet little is known about how this residence-specific environmental health risk affects property values. In this paper, we estimate the benefits of lead-paint remediation on housing prices. Using data on all homes that applied to a HUD-funded program in Charlotte, North Carolina, we adopt a difference-in-differences estimator that compares values among remediated properties with those for which an inspection does not identify a lead paint hazard. Results indicate that remediation has large benefits -- a typical investment of $7,291 is associated with a capitalized benefit of $20,323 as well as a reduction in residential turnover.

Keywords: lead exposure, lead paint, lead hazard control, environmental quality, urban environmental health

JEL Classification: Q51, Q52, Q58, R21, R23, R31, I18