The Effect of Algae Blooms on Property Values located on Florida's Indian River Lagoon

Florida’s Indian River Lagoon has algae blooms that devastate ecosystems, water quality,and markets for seafood, recreation, and housing. This study estimates part of their economic impact by examining water quality’s relationship with prices of properties sold near the estuary from 2007 to 2016. Using water quality scores from 0 to 100, my regression analysis estimates that one-unit increases in water quality are associated with one-percent increases in sale price.Upon summing this relationship over all properties in the sample, my paper estimates that the sea algae blooms have cost the housing market between $756 million to $3.6 billion.