Fact check: Does fracking negatively impact property values?

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April 7, 2016
By Autumn Lewien

In December 2015, Kaye Fissinger, president of the environmental group Our Health, Our Future, Our Longmont, published an op-ed in the Longmont Times-Call, a local Colorado newspaper, in which she claims that hydraulic fracturing, or fracking, leads to falling property values. "In some cases property values have declined up to as much as 75 percent due to the proximity of fracking operations," writes Fissinger, "[p]roperty values plummet along with the inability of homeowners to sell their homes when prospective buyers learn of the nearby fracking debacle."[1]

Fissinger’s op-ed was published a few days before the Colorado Supreme Court heard cases from Longmont, where residents passed a ballot measure to ban fracking in 2012, and Fort Collins, where, in 2013, voters approved a five-year moratorium on fracking.[2] The Supreme Court's decision is expected to be released in the spring of 2016.[3] Meanwhile, the Colorado House of Representatives, on April 4, 2016, voted against a bill that would have granted local governments "more authority over fracking."[4]

Does hydraulic fracturing impact property values? Yes; however, the evidence is inconclusive regarding the scope, positive or negative, of these impacts. Additionally, for most studies that find a negative effect, the estimated percent change is significantly lower than the 75 percent Fissinger cites.

Local fracking bans: Longmont and beyond

In November 2012, the citizens of Longmont voted 60 percent to 40 percent to ban hydraulic fracking within its city limits. The Colorado Oil and Gas Association (COGA), joined by the state of Colorado, filed a lawsuit in December, challenging the city’s right to ban an industry regulated by state and federal authorities. In July 2014, the lower court in Boulder, Colorado, overturned the Longmont ban, concluding that regulation of the industry is the state’s prerogative.[5] One month later the Longmont city council voted 7-0 in favor of appealing, and on December 9, 2015, the Colorado Supreme Court heard Longmont’s case.

Longmont’s push to ban fracking is not unique. Over the past few years there have been a number of other bans and moratoriums across the country: Denton, Texas; Athens, Ohio; and Santa Cruz County, California, to name a few.[6][7] In December 2014, New York Gov. Andrew Cuomo (D), acting on a joint recommendation from the New York Department of Environmental Conservation and Department of Health, announced a statewide ban on the oil and natural gas extraction process.[8] However, similar bans have failed at the polls elsewhere, and in 2015, the Ohio Supreme Court Ballot Law Update: Ohio Supreme Court rejects anti-fracking county charters, but protects initiative process struck down local fracking bans.[9][10]

Update: On May 2, 2016, the Colorado Supreme Court struck down the local prohibitions on fracking in Longmont and Fort Collins.

Why is hydraulic fracturing such a debated issue?

Hydraulic fracturing has been used for decades, but the scale and scope have increased sharply over the last decade, aided by advances in drilling technology.[11][12] The result has been what National Geographic has called "the great shale gas rush."[13] A recent study conducted by the U.S. Energy Information Administration forecasts that natural gas will supplant coal as the primary source of electricity in the U.S. this year, due, in part, to fracking.[14]

Proponents of fracking claim that the fracking boom has created jobs and driven economic growth in states like North Dakota, Texas, and Ohio.[15] At the same time, however, the technique—which involves the injection of large volumes of water mixed with sand and chemicals deep into shale formations to free formerly inaccessible natural gas, oil, and other liquid hydrocarbons—has led to public concern about potential environmental impacts and health effects.[12] These issues range from potential water contamination and air pollution to noise, truck traffic, and even minor earthquakes.[16][17][18]

A 2015 U.S. Environmental Protection Agency (EPA) report on the impact of hydraulic fracturing found no evidence that the drilling technique has led to widespread pollution of the nation’s water supply:

From our assessment, we conclude there are above and below ground mechanisms by which hydraulic fracturing activities have the potential to impact drinking water resources. [...] We did not find evidence that these mechanisms have led to widespread, systemic impacts on drinking water resources in the United States.[19][20]

These findings, however, have done little to cool the national debate over the drilling technique. Public concern about fracking’s environmental impacts, and the political and media attention it has garnered, continues to drive opposition to fracking and may, as Fissinger claims, negatively impact property values.

Property Values and Fracking

Fissinger pointed Ballotpedia to a September 18, 2010, article in the Dallas Morning News as the source for her remarks.[21] The article documents a case in which Tim and Christine Ruggiero, homeowners in Wise County, Texas, lost an estimated 70 percent of their home value—from $257,330 to $75,240—after Aruba Petroleum began drilling on their land. The Wise County appraisal review board, which voted to reduce the home and land values by 70 and 75 percent, respectively, noted that “the drilling company's use of the Ruggieros' land warranted the extraordinary reduction.”[22] However, this case is not representative.

The impact of hydraulic fracking on property values has become the focus of a growing body of literature, and in general, studies suggest that benefits and costs of fracking vary sharply across property types and are influenced by a variety of variables, including proximity, drinking water sources (groundwater or piped water), and land type (rural or urban), to name a few.

For example, in a 2013 study, Gopalakrishnan and Klaiber, of the University of Ohio, using data from Washington County, Pennsylvania, found that, in general, proximity to shale gas wells negatively impacts property values; however, the degree of effect is dependent on property characteristics. For instance, for properties located within 0.75 miles of a well, the percent change in property values ranges from -1.4 to -21.7, with higher losses falling “disproportionately” on rural properties with private groundwater wells. The authors also found that the impact is largely short term and suggested “that perceptions of risk” may be driving the losses.[23]

Muehlenbachs, Spiller, and Timmins (2012), using data from the same county, similarly found that “concern for groundwater contamination risk” decreases property values—up to 23.6 percent—for homes dependent on private-groundwater wells. For properties with access to piped-water, however, proximity to well pads increases property values by 10.7 percent. According to the authors, the increase is likely attributable to lease payments.[24]

Similarly, a 2015 study conducted by Boslett, Guilfoos, and Lang suggested that the statewide moratorium on hydraulic fracturing in New York resulted in a 23.1 percent decline in property values. This decline, the authors conclude, indicates “a positive net valuation of [shale gas development].”[25]

The main findings of several studies, including the ones discussed above, are detailed in the chart below:


Ballotpedia has conducted its own study on this issue, concluding that there is “no definitive evidence that fracking negatively impacted home values and sales across seven counties in Colorado in 2015.” Indeed, the data illustrates that in two counties, homes close to oil and gas development had higher home values and sales, while in four counties property values and sales declined with proximity.

Conclusion

In a December 2015 op-ed, Kaye Fissinger claimed that "in some cases property values have declined up to as much as 75 percent due to the proximity of fracking operations."[1] In our examination of the relevant literature, we find that fracking does have an impact on property values; however, whether that effect is positive or negative depends on a variety of variables, including proximity to a well and the home’s source of water. For example, one study finds that, for houses reliant on piped-water, proximity to well pads increases property values by 10.7 percent. On the other hand, for groundwater-dependent properties, "concern for groundwater contamination risk" may reduce property values up to 24 percent.[24]

See also

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Launched in October 2015 and active through October 2018, Fact Check by Ballotpedia examined claims made by elected officials, political appointees, and political candidates at the federal, state, and local levels. We evaluated claims made by politicians of all backgrounds and affiliations, subjecting them to the same objective and neutral examination process. As of 2025, Ballotpedia staff periodically review these articles to revaluate and reaffirm our conclusions. Please email us with questions, comments, or concerns about these articles. To learn more about fact-checking, click here.

Sources and Notes

  1. 1.0 1.1 Fissinger, K. Longmont Times-Call, "Kaye Fissinger: Fracking violates our inalienable rights," December 6, 2015
  2. Antonacci, K., Longmont Times-Call, "Longmont’s fracking ban due before state Supreme Court," December 9, 2015
  3. Hood, G., Colorado Public Radio, "Huge Crowds Watch as Greeley OKs Drilling Project in City Limits," March 9, 2016
  4. Bunch, J., The Denver Post, "Bill to give local governments more control over fracking dies in Colorado House," April 4, 2016
  5. District Court: Boulder County, "Colorado Oil and Gas Association v. City of Longmont," July 24, 2014
  6. Krauss, C., New York Times, "Split Decision by Voters on Local Fracking Ban," November 5, 2014
  7. CA Frack Facts, "Policy: Local Fracking Regulations," accessed March 23, 2016
  8. New York State Department of Health, "A Public Health Review of High Volume Hydraulic Fracturing for Shale Gas Development," December 2014
  9. Cama, T., The Hill, "Mixed results for local anti-fracking measures," November 5, 2014
  10. Cama, T., The Hill, "Ohio court strikes down local fracking bans," February 17, 2015
  11. Martin, D., New York Times, “George Mitchell, a Pioneer in Hydraulic Fracturing, Dies at 94,” July 26, 2013
  12. 12.0 12.1 Hester, R., and Harrison, R. (2015). Fracking, Cambridge, UK: Royal Society of Chemistry. (Page 71)
  13. Lavelle, M., National Geographic, "Natural Gas Stirs Hope and Fear in Pennsylvania," October 23, 2010
  14. U.S. Energy Information Administration, "Natural gas expected to surpass coal in mix of fuel used for U.S. power generation," March 16, 2016
  15. American Petroleum Institute, "Oil and Natural Gas Stimulate American Economic and Job Growth," accessed March 25, 2016
  16. Osborn, S., et., al. (2011). "Methane contamination of drinking water accompanying gas-well drilling and hydraulic fracturing." Proceedings of the National Academy of Sciences, 108, 20. (2011): 8172-8176
  17. Llewellyn, G., et., al. "Evaluating a groundwater supply contamination incident attributed to Marcellus Shale gas development." Proceedings of the National Academy of Sciences, 112, 20. (2015): 6325-6330
  18. Rayman, N., Time, "Study Links Ohio Earthquakes to Fracking," January 8, 2015
  19. Environmental Protection Agency, "Assessment of the Potential Impacts of Hydraulic Fraturing for Oil and Gas on Drinking Water Resources: Executive Summary," June 2015
  20. Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
  21. Autumn Lewien, "Email communication with Kaye Fissinger," March 26, 2016
  22. Heinkel-Wolfe, P., The Dallas Morning News, "Drilling can dig into land values," September 18, 2010
  23. 23.0 23.1 Gopalakrishnan, S., and H. Klaiber. "Is the Shale Boom a Bust for Nearby Residents? Evidence from Housing Values in Pennsylvania." American Journal of Agricultural Economics. (2013): 43-66
  24. 24.0 24.1 24.2 Muehlenbachs, L., Spiller, E., and C Timmins. "Shale Gas Development and Property Values: Differences Across Drinking Water Sources." National Bureau of Economic Research. (2012)
  25. 25.0 25.1 Boslett, Andrew, Guilfoos, Todd, and Corey Lang. “Valuation of Expectations: A Hedonic Study of Shale Gas and New York’s Moratorium.” Journal of Environmental Economics and Management, 77, 2016. (2015): 1-41
  26. James, Alexander, and Jasmine James. “A Canary Near a Gas Well: Gas Booms and Housing Market Busts in Colorado.” Working Paper. (2015): 15
  27. Muehlenbachs, L., Spiller, E., and C Timmins. "The Housing Market Impacts of Shale Gas Development." American Economic Review, 105, 12. (2015): 3633-3659
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