Document Type

Thesis

Date of Degree Completion

Spring 2021

Degree Name

Master of Science (MS)

Department

Cultural and Environmental Resource Management

Committee Chair

Charles Wassell

Second Committee Member

Sterling Quinn

Third Committee Member

Toni Sipic

Abstract

Flood events are the most common and costly natural disasters. The Federal Emergency Management Agency (FEMA) quantifies flood risks in the form of Flood Insurance Rate Maps (FIRMS). These FIRMS delineate flood risks and are used to set flood insurance premiums. Changes in land use, the augmentation of the natural environment, is threatening the validity of the Nation’s FIRMS. Therefore, Congress has approved remapping programs to update these FIRMs ensuring that current flood risks are known. This remapping presents another issue, specifically for properties that are remapped into a flood zone. Current literature suggests that properties within flood zones are discounted 5-13% compared to homes outside a flood zone. Therefore, the switching of flood zone status should negatively impact property values. To explore how the switching of flood zone status, as indicated by the remapping of FIRMs, impacts property values, a fixed effects hedonic pricing model will be estimated. We look to add to the limited literature related to revealing the impact of switching flood zone status through time and expand upon it by investigating consumer behavior towards the release of updated preliminary flood zones. Results suggest that properties who are remapped into a flood zone are initially valued higher during the release year, but one year after the remapping their prices converge with properties who have always been within a flood zone.

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