Guest post by Joan Campbell
ULI’s research team often gets asked whether transit investments have resulted in increases in property values for nearby communities. As you can imagine, this is a complicated question to answer. Below are five recent reports that shed some light on this question. (And if you want the short version, the answer seems to be: yes, to a certain degree, in most cases.)
The Center for Housing Policy’s 2011 report, Public Transit’s Impact on Housing Costs: A Review of the Literature, written by Keith Wardrip, concludes that the overall consensus among the studies and reports reviewed is that “proximity to public transit does lead to higher home values and rents in many cases.” But, he points out that the level of impact is debatable and is based on a number of factors, including the transit system’s level of service and dependability; housing market conditions; and the type of nearby development.
The New Real Estate Mantra: Location Near Public Transportation, released in March 2013, was a team effort among the American Public Transit Association, the National Association of Realtors, and the Center for Neighborhood Technology. The report, a study of property values near transit, finds that housing values near transit facilities fared 41.6 percent better than homes that were farther away. Furthermore, a look at the issue of price resilience noted that properties with greater transit access had retained their property values. Findings are presented for five study regions—Boston, Chicago, Minneapolis/St. Paul, Phoenix, and San Francisco.
The 2013 Knight Frank report, Action Stations: The Impact of Crossrail on Residential Property in Central London, takes a look at the impact of Crossrail—London’s most significant transit investment project—on property values. The researchers measured price premiums in walk zones—namely, areas within a ten-minute walk from station entrances. Results showed that since 2008, when the Royal Assent approved the Crossrail project, property prices have jumped more than 30 percent. By 2018—the year the Crossrail is scheduled to open—anticipated price performance is expected to vary by station. For example, the level of regeneration around stations will have a major impact on property values. Knight Frank, at set intervals, plans to continue monitoring prices up to the opening of Crossrail and thereafter.
A study of Charlotte-area single-family home prices was conducted from 1997 through 2008. The 2012 report, The Impact of a New Light Rail System on Single-Family Property Values in Charlotte, North Carolina, presented in the Journal of Transport and Land Use last year, shows results were varied among pre−station plans, planning, construction, and operating phases. Negative price impacts were reported before the train became operational. However, after the train opened the homes located near the station began seeing positive appreciation in prices.
Finally, Sydney’s Macquarie University station—located on the Epping Crossworth’s rail line—was the subject of a recent paper presented at a Pacific-Rim Real Estate Society Conference. The 2012 report, Assessing the Impact of Rail Investment on Housing Prices in North-West Sydney, compares housing prices for several time periods, including before and after construction of the rail station was made known in 2002, as well as pre- and post-opening of the station in 2009. Prices are noted as increasing both before construction began and after completion of the station.
Do you know of other research resources that explore the impact of transit on land values? Let us know by leaving a comment below.