The noise perception impact on residential property values: An analysis for Barcelona

Environmental noise is one of the main prices that modem societies have to assume for living in densely urbanized areas. The noise impact on people's quality of life goes beyond annoyance, and it may affect somatic and psychic aspects of health. Economic theory suggests that, in an equilibrium system, there is a tradeoff between land value and environmental quality, such compensation allows equaling the utility function of residents. In this paper I report the first conclusions of a research that try to prove this tradeoff for the Barcelona case, a municipality severely affected by environmental noise (e.g. road, pedestrian traffic, schools, etc.). Using a hedonic price model, and GIS, the impact of the perceived environmental noise on residential property prices is assessed. The analysis suggests that, in general, noise perception is no associated, in statistical terms, with residential value. Since noisy areas are also the areas with the best public transportation, facilities, retail, etc. On the other hand, other environmental aspects indirectly related to noise, like manufacturing premises, are negatively related to price. Nevertheless, when data market is segmented by homogeneous socioprofessional areas there is an exception: in the areas of high qualified people, ceteris paribus, the environmental noise have a negative impact on residential prices.