E. coli outbreaks can hurt real estate values, study finds

Credit: Centers for Disease Control and Prevention

By Eric Freedman

Capital News Service

Outbreaks of the waterborne bacteria E. coli can lower local real estate values, at least temporarily, a new study says.

Those outbreaks, which have become increasingly common, are a growing concern in coastal and inland communities, particularly in rural counties, according to the study by researchers from Saginaw Valley State University, Cornell University and the University of Rhode Island.

“In Michigan, the presence of E. coli has become problematic for many areas where agricultural run-off and ineffective policies have made these outbreaks endemic,” the study said.

As for the negative economic impact on homes within one mile of an outbreak, the study found that “proximity to E. coli outbreaks leads to an 8.9% price drop for houses sold during the outbreaks, which is over $13,000 for the average home.”

  1. coli can cause serious illness and death, and is increasingly common due to climate change, especially in the Great Lakes region, it said. Symptoms included diarrhea, fever and vomiting, according to the Centers for Disease Control and Prevention.

“Once E. coli enters a waterway, it can travel large distances away from the source,” according to the study in the journal Agricultural and Resource Economics Review.

And while bacteria levels in the water drop over time, the bacteria can survive in beach and shoreline sediments, “continuing to affect water quality and making outbreaks more likely over time,” it said.

Department of Environment, Great Lakes and Energy data shows that about half the state’s water bodies exceeded the Environmental Protection Agency’s water quality standard for E. coli this year, and an estimated 20% of monitored beaches were recently closed due to unsafe bacteria levels.

Among those closed at some point last summer were beaches at Ross Lake in Gladwin County, Warren Dunes State Park in Berrien County, Mullet Lake in Cheboygan County, Sugden Lake in Oakland County, Veterans Memorial Park in Menominee County and St. Clair Shores Memorial Park in Macomb County.

To reach their conclusion, the research team combined data from the department with the sales price of nearby single-family homes.

“However, these effects do not persist past an interim period,” the study said, and sales prices rise again “as days pass from the last outbreak.”

The researchers noted the local governments currently set their own E. coli regulations, sometimes leading to “conflicting policies and inefficient societal outcomes. They suggested that it might be cost-effective to come up with statewide governmental policies to address potential future E. coli outbreaks, “especially in a state like Michigan where water-related activities play a major social and economic role.”

 

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