In 21st century real estate, it’s all about “walkability, walkability, walkability.”
According to recent research published by Redfin, a one-point increase in a district’s Walk Score leads to a one percent increase in property value. Typically, that translates to ~$3,000 extra per point on your property’s value. To put it another way, properties in highly walkable areas usually sell for 23 percent more than places that require a car.
Interestingly, the Brookings Institution found a significant uptick in rental prices in more walkable districts. For instance, in Washington, DC, average monthly rents in walkable areas were at least $300 above average.
Although higher Walk Scores often add value to a home’s property, don’t expect a huge premium if you live in a car-centric city. Even if your property is in a district with a high Walk Score, you will only see substantial price increases if the entire city has strong walkability standards.
As an example, Redfin found homes in San Francisco—sometimes considered America’s most walkable city—jumped $188,000 when the Walk Score improved from 60 to 80. On the opposite extreme, homes in car-centric Phoenix only experienced a $16,000 increase with the same Walk Score change.
Can High Walk Scores Hurt A Property’s Value?
To date, there’s only one area in America where home prices dip as Walk Scores increase: Orange County, CA. The price people would pay for a luxury home in this area dropped by $500 when Walk Scores reached max levels.
Although Orange County is an outlier, it should serve as a reminder that high Walk Scores don’t always lead to premium prices. Property analysts still need to figure out what homebuyers in different cities are most interested in.
The Road Ahead: Walkable Homes In The Future
It’s unlikely the walkability trend will decrease in future decades. As pedestrians and cyclists increase across the USA, city leaders will have to respond with enhanced safety measures and infrastructure. Plus, most millennials don’t seem to care about driving cars as much as boomers, which means they will be far more interested in a home’s walkability.
To meet this increased demand and attract young talent, cities like Philadelphia and Chicago are actively building properties in highly walkable areas. Philadelphia has some more work to do as does Chicago. Most cities also have official Vision Zero safety programs to help eliminate traffic deaths. All of these measures should enhance Walk Scores across the USA and increase the supply of walkable homes.
Comments (5)Subscribe to CommentsComment