Abstract
Generally accepted real estate valuation theory, augmented by ample empirical evidence, supports the notion of significant impacts on prices of residential properties near highways. Houses adjacent to highways are exposed to potentially increased traffic noise, although these homeowners may benefit from increased accessibility to highway systems. This study is prompted by a massive new highway construction project (25 miles at acost of $1.5 billion over a nine-year period) that will complete a 110-mile beltway around the Orlando, Florida metropolitan area. Using observed prices of houses near existing highways, this study provides insights into the potential effects of the new highway on planned and existing houses in thi smarket. The results indicate significant price discounts for houses adjacent to highways, houses near high-traffic highways, and houses farther from highway on-ramps, but no significant impact related to distances from houses to highways or sound barrier walls.
