Homes in neighborhoods where goods, services and fun things to do are located within walking distance can command a price premium of $4,000 to $34,000 over otherwise similar homes in less walkable areas, according to an analysis of recent home sales.
The study, "Walking the Walk," was commissioned by CEOs for Cities, a group that promotes sustainable cities. The study focused on about 90,000 recent home sales in 15 markets, finding a positive correlation between home values and walkability in all but two — Las Vegas and Bakersfield, Calif.
Walkability was defined using an algorithm dubbed Walk Score that was developed by "civic software" developer Front Seat.
The Walk Score algorithm calculates a property’s proximity to restaurants, coffee shops, schools, parks, stores and other amenities, assigning a score from zero to 100 depending on how many are within walking distance. A Walk Score of 70 or above indicates neighborhoods where it’s possible to get by without a car.
The study, which controlled for factors such as property size and a neighborhood’s income level and proximity to jobs, found a one-point increase in Walk Score was associated with an increase in value ranging from $500 to $3,000, depending on the market.
Increases were larger in denser areas like Chicago and San Francisco, and smaller in less dense markets like Tucson and Fresno.
The study did not take into account some variables that can affect home values, including lot size; environmental amenities; building improvements such as fireplaces, swimming pools, garages; and the quality of local schools. More studies looking at a wider set of variables are planned.
In another recent study using the Walk Score algorithm, researchers looked at whether walkability affected property values and investment returns of office, apartment, retail and industrial properties over the past decade.
That study, by researchers at Boston College, the University of Arizona, and Indiana University, found a 10-point increase in walkability increased property values by 5 to 8 percent, depending on property type.
Front Seat offers an application programming interface (API) that generates Walk Scores for listings offered by Zillow.com, ZipRealty.com and others, which also allows users to search for properties by Walk Score (see story).
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