Urban floods and residential rental values nexus in Kumasi, Ghana
The supposition that the occurrence of flood event will have an inverse effect on rental values of residential housing properties is often accepted as a fact. However, the mechanism for this supposed impact has not been clearly articulated and the hypothesis is far from proven in Ghanaian housing rental market. This paper examined the impact of flood on residential rental values in Kumasi. The study adopted multiple research approaches in selecting zones with both flood and non-flood liable residential properties. The repeated sales model was then used to create local market indices to gauge flood impact on the rental values. The rental values of non-flooded residential properties were generally higher than their flooded counterparts by a margin of GHS 62.66 ±0.09 annually. While this supports existing postulations of a negative impact of flood on rental values, the results further showed that the extent of the impact varies across different residential property types. It is concluded that the wholesale assumption in literature that flood events diminish rental values should be interpreted with caution. The study recommends that the (dis)amenity effects of flood on rental values should therefore be assessed on case by case basis.
Keywords: Floods, Ghana, Kumasi, Residential Rental Value, T-test