What’s It Cost to Live Near a Sex Offender?
About four percent of the value of your home. That’s what the economists Leigh Linden and Jonah Rockoff (both of Columbia University) concluded in a National Bureau of Economic Research working paper called “There Goes the Neighborhood? Estimates of the Impact of Crime Risk on Property Values From Megan’s Law.” Here’s how the NBER Digest summarizes their findings:
They combine data from the housing market with data from the North Carolina Sex Offender Registry to find that when a sex offender moves into a neighborhood, houses within a one-tenth mile area around the sex offender’s home fall by 4 percent on average (about $5,500), while those further away show no decline in value. “These results suggest that individuals have a significant distaste for living in close proximity to a known sex offender,” the authors conclude.
I am well known for admiring economists, but even I have to admit that that last sentence is a little, um … obvious? More significantly, however: I wonder when, or if, homesellers will be routinely required to notify potential buyers of a nearby sex offender. Linden and Rockoff note that is already the case in some states, but I am guessing it is rare. On the other hand, it’s already pretty easy to search for registered sex offenders in a given neighborhood, so maybe this is just one more element of home-shopping that people will become accustomed to. Finally, I can imagine that if the Linden-Rockoff findings become common knowledge, it will make people scream even louder about having a registered sex offender placed in their neighborhoods.