An Assessment of the Effect of Coastal Externalities on Residential Housing Prices in Badore, Lagos-Nigeria

Abstract

The paper employed hedonic price model in the estimation of the effect of coastal externalities on the rental value of residential property in Badore community of Lagos, Nigeria. Previous investigations on coastal community property values particularly in the developed economies have revealed that, proximate residential property to coastline areas have presented a worthwhile value to investors across the globe with those residential properties fronting the coastline outperforming those with reasonable distance from the coastline zones. Intrigued by this finding, the current study therefore undertook its investigations from two dimensional perspectives which are to determine if a similar result exists for Badore community, a coastal area in Ibeju-Lekki local municipality of Lagos State. Data was collected from 256 structured questionnaires completed by household heads who are tenants within 500 meters of the coastline in the study area. Model 1A-C accounted for the influence of coastal amenities and other housing attributes on rent. Model 2A-C accounted for the effect of the interaction between coastal amenities/disamenities alongside other housing attributes on rent. The results suggest that for a meanpriced home (N224,846) at the mean distance from the coastline (282.96 m), a 1% increase in distance from the coastline would result in a 0.04%or N34.17 increase in rental value. When disamenity was controlled for in the entire- sample hedonic model, flooding further lower house rents in Badore by 0.12% (N94.56) for every 1% decreasing distance to the coastline.