Evading invasives: How Eurasian watermilfoil affects the development of lake properties

- Human behavior is altered by invasive species impact on ecosystems.
- We use a hazard duration model to examine changes in new housing supply
- We show that both lakefront and near lake areas see reduced development post invasion
- Counterfactual simulations show invasions in a census tract reduce development on average by 19 houses over our study period

Eurasian watermilfoil is an aquatic invasive plant that has spread rapidly through freshwater lakes across the United States. Along with being a hazard to local ecosystems, milfoil is a nuisance to those who use lakes for recreation, and its presence has been shown to lower lakefront property values. This study presents the first evidence of the effects of Eurasian watermilfoil on the probability that undeveloped properties near lakes are developed into single-family housing units. Using a comprehensive dataset from the Twin Cities, Minnesota region, a duration model of land conversion is estimated using data on new home construction from 1990 through 2005. We find that undeveloped parcels of land on and near lakes invaded by Eurasian watermilfoil are less likely to be developed than their counterparts on non-invaded lakes. In counterfactual simulations, we show that absent spread after 1990, total development would increase in 112 of the region's 650 census tracts by an average of 19 houses per tract.