Groundwater Contamination: Its Effects on Property Values and Cities

This paper discusses the impact of groundwater contamination with toxic chemicals on the value of contaminated and surrounding property. The case studies indicate that groundwater contamination negatively affects the value of commercial and industrial properties, but not residential properties. This finding suggests that real estate markets may not be functioning properly. The risk of liability for contamination may differ by type of property. The paper explores the policy implications, especially for cities, where fear of liability may inhibit action to protect public health.