[OKC] CEOS for Cities and WalkScore release study on price premiums in walkable neighborhoods

[Alig, Jennifer L.]

The study link is
http://blog.walkscore.com/wp-content/uploads/2009/08/WalkingTheWalk_CEOs
forCities.pdf


http://www.grist.org/article/2009-08-18-pay-more-walkability/
 

 

 

  Would you pay more for walkability? Should you?

  Posted 9:51 AM on 18 Aug 2009

  by Katharine Wroth

 

 

  Forget letting your fingers do the walking: A study released today
shows that homebuyers are letting their wallets do 
  the walking, paying more for homes in neighborhoods where you can get
around without wheels.                          
  Conducted by CEOs for Cities, the analysis looked at 94,000
real-estate transaction in 15 markets across the U.S.,    
  from Fresno, Calif., to Arlington, Va. Researchers found that in 13 of
the markets, housing values were higher in more
  walkable neighborhoods. (What about the other two markets? In
Bakersfield, Calif., no correlation was found; in the   
  other, which starts with Las Vegas and rhymes with Armageddon, housing
values were lower in walkable neighborhoods.)  
  Using data from Walk Score, the study found that houses in hoods with
above average walkability commanded $4,000 to   
  $34,000 more than those in hoods with average walkability.
Characterized as the first to put a dollar value on        
  walkability, the study could be big news for municipal leaders and
mere mortals alike, said CEOs for Cities head Carol
  Coletta: "These findings ... tell us that if urban leaders are
intentional about developing and redeveloping their    
  cities to make them more walkable, it will not only enhance the local
tax base but will also contribute to individual 
  wealth by increasing the value of what is, for most people, their
biggest asset."                                     
  But wait, you're saying (as one staffer did at our news meeting this
morning): Couldn't this connection just be due to
  the fact that walkable areas tend to be metro areas, and that makes
them more expensive in general? The smarties      
  behind the study are all over that:

       Using an economic technique called hedonic regression, we
estimate how much market value homebuyers implicitly   
       attach to houses with higher Walk Scores ... Our statistical
approach controlled for key characteristics of      
       individual housing units (their size, number of bedrooms and
bathrooms, age and other factors), as well as for   
       the neighborhoods in which they were located (including the
neighborhood's income level, proximity to the urban  
       center and relative accessibility to employment opportunities).
After controlling for all of these other factors 
       that are known to influence housing value, our study showed a
positive correlation between walkability and       
       housing prices in 13 of the 15 housing markets we studied."

  They had me at hedonic regression.

  For me, the question is: Should we have to pay more for the privilege
of being able to walk to a grocery store or     
  school or post office or local pub? Walking-which the study terms a
"largely unmeasured and grossly under appreciated 
  component of the urban transportation system"-is good for our health
and good for the planet, not to mention good for 
  things like car-insurance premiums. Should such a set-up be available
only to those who can afford it? Our old friend 
  Clark Williams-Derry over at Sightline offers this take:

       What the CEOs for Cities study shows is that there is a real and
measurable pent up demand for homes in walkable 
       neighborhoods. For decades, sprawl apologists have argued that
low-density suburban development was somehow      
       "natural," because it's what homebuyers "prefer." By now, though,
it's clear that many homebuyers are willing to 
       pay a premium for walkability. The real problem is that the
demand for walkable homes exceeds the supply-which   
       pushes up the price.

       To me, that argues for policies that are designed to increase the
supply of homes in walkable neighborhoods.     
       That's good for affordability, good for reducing transportation
costs, and a great way to help more people add   
       walking to their daily routines.

 





***********
Megan M. Susman
U.S. Environmental Protection Agency
Office of Policy, Economics and Innovation
Mail Code 1807T
1200 Pennsylvania Avenue, NW
Washington, DC 20460
Phone: 202-566-2861
Fax: 202-566-2868
Email: susman.megan at epa.gov
------------------------------
Development, Community & Environment Division:
http://www.epa.gov/smartgrowth
A partner in the Smart Growth Network: http://www.smartgrowth.org
<http://www.smartgrowth.org/> 

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