IMPACT OF FLOOD EXPERIENCES AND RISKS ON LAND PRICES IN FREQUENTLY-FLOODED AREAS: A CASE STUDY ON NAGOYA CITY

Abstract

 Studies on the change of real estate prices pre- and post-floods are conducted to understand residents’ flood risk perceptions. Earlier studies suggest, in flood-prone areas, real estate value will be minimally affected by flood occurrences. At the same time, real estates are valued less in the high-risk areas within the flood-prone areas. However, studies have suggested that information on the degree of flood risk, correlated with the price decline, has changed due to improved flood control performance. Thus, the impact of flood risk information on real estate prices is expected to be increasing, given the fact that residents are increasingly accessing flood risk information. In this study, we analyzed a relationship between land price and flood risk information targeting Nagoya City, a region renowned for its flood-proneness. The analysis reconfirmed that the areas previously flooded are priced low at regular times and do not change after floods. The study also confirmed the information on the estimated flooding area has a larger impact on price than the actual flooded area, and the price drop of real estates in the area with no recent flood experience is larger within the estimated flooding areas.