Property tax increases affect real estate profitability but owners pass these costs on to tenants. For some costs, escalation is part of the risk. Other market risks also exist, such as development of competitive projects, changing demographics, and changes in local and national economies. These are traditional risks and participants accept them in exchange for property rewards. In contrast, real estate contaminated with hazardous substances is difficult to evaluate.
Uncertainty exists because changes have occurred which affect property values, and are continuing.
This disheartening situation creates an imperfect market and variations in price. Owners and operators of a contaminated facility who use it productively and with no intention to sell, place a high value on it. Conversely, an owner motivated to sell a comparable property may accept a low offer. In some ways uncertainty associated with contaminated property has increased since 1980, particularly in the number of parties involved with contaminated sites. In other ways, uncertainty has diminished because of improved remediation technologies.