Effects of rooftop solar on housing prices in Australia
Date
2021-05
Authors
Best, Rohan
Burke, Paul
Nepal, Rabindra
Reynolds, Zac
Journal Title
Journal ISSN
Volume Title
Publisher
Wiley
Abstract
Hedonic models of housing prices face the risk of omitted variable bias due to the challenge of controlling for all relevant property attributes. The level of household financial assets is a key but underexplored control that may help to account for some of these difficult-to-observe property characteristics. Using large Australian household surveys, we find that controlling for household financial assets reduces the observed effect of having solar photovoltaic panels on housing prices. The elasticity of estimated housing price with respect to solar capacity is 0.09 for households with solar panels. Controlling for financial assets may be of use in other studies seeking to estimate the effect of home additions on housing prices.
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Keywords
financial assets, hedonic pricing, housing, location, solar
Citation
Best, Rohan, Burke, Paul J., Nepal, Rabindra, and Reynolds, Zac. 2021. Effects of rooftop solar on housing prices in Australia. Australian Journal of Agricultural and Resource Economics 65(3), 493–511.
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Source
Australian Journal of Agricultural and Resource Economics
Type
Journal article
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Access Statement
Open Access
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Restricted until
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