The effect of conservation easements on residential housing prices in the contiguous United States: a county-level panel data approach

Abstract

Permanent conservation easements, an increasingly popular conservation tool, may increase the average sales price of nearby homes due to an interaction between supply and demand effects. I use panel data from the contiguous United States from 2001-2022 in a two-way fixed effect model to identify the causal effect of additional conservation easement acres on a county's median housing price. I find a statistically significant average increase of about $885.10 or 0.64% after a 1% increase in county land acreage under easement. The magnitude and direction of this effect varies depending on county characteristics, such as ruralness, population density, and building density, as well as the specific type of conservation easement. An overall rise in housing prices may have effects on property taxes, making these findings particularly relevant for homeowners and policymakers.