A neighborhood's walkability can make a significant difference in the selling price of otherwise similar homes, according to a new study by by the advocacy group CEOs for Cities.
Just consider this example as you take your next stroll: In two suburbs outside Charlotte, N.C., two homes are built the same year, with the same square footage and the same bedroom and bathroom count. These two houses also are located in places with the same neighborhood income level and the same distance to Charlotte's central business district.
But these two homes are not equal on the market. In one neighborhood, the house sells for $280,000 while its counterpart goes for $314,000. The difference, according to CEOs for Cities' research, is the homes' relative walkability.
The study's Charlotte finding isn’t a fluke relegated to one market. Similar price differentials were uncovered in 13 out of 15 metro markets examined in the study, “Walking the Walk: How Walkability Raises Housing Values in U.S. Cities,” which analyzed data from 94,000 real estate transactions provided by Zip Realty. In the majority of locales, pedestrian access to restaurants, schools, parks, grocery stores, jobs, libraries, and more translated directly into higher home values.
“Even in a turbulent economy, we know that walkability adds value to residential property just as additional square footage, bedrooms, bathrooms, and other amenities do,” said study author Joseph Cortright. “It’s clear that consumers assign a tangible value to the convenience factor of living in more walkable places with access to a variety of destinations.”
For research purposes, “walkability” was defined by the Walk Score algorithm, which calculates the proximity of various amenities to any U.S. address and assigns a “walk score” to that address on a scale of zero to 100, with 100 being the most walkable and zero being completely car-dependent. A neighborhood with a walk score of 70-plus is one in which it’s possible to live without a car.
So what’s a walk score worth from a marketability perspective? According to study findings, a one point increase in walk score can translate into a property value increase of $700 to $3,000, depending on the market. The gains were larger in denser, urban areas such as Chicago and San Francisco and lower in smaller markets like Tucson and Fresno.
Overall, the study concluded that houses in pedestrian-friendly neighborhoods with superior walk scores could command premiums anywhere from $4,000 to $34,000.
"There are a number of trends that are reshaping the American Dream," said Carol Coletta, President and CEO of CEOs for Cities, "and the value home buyers now place on living close to more daily destinations is one of the most important. Now, planning, zoning, and development decisions have to catch up to consumers."
Jenny Sullivan is a senior editor for BUILDER covering architecture and community planning.
Learn more about markets featured in this article: Charlotte, NC.