Homebuyers Pay More to Walk
Pedestrian-friendly cities have survived the bust better than cities where the average house is a long walk from services, according to an analysis of Standard & Poor's Case-Shiller Home Price Indices.
We split the list of 20 metro regions covered by Case-Shiller in half, using data from WalkScore.com, which rates the 'walkability' of cities, or average distance to stores, parks and amenities. The ten least walkable cities on Case-Shiller suffered price drops of more than a third. Prices in the ten most walkable cities have dropped by less than a quarter overall since June 2006.
In addition, all but one of the five cities that score over 150 on Case-Shiller (based on a benchmark of 100 for the year 2000) are on the pedestrian-friendly half of the list, including New York City, Boston, and the District of Columbia. And all but one of the seven cities that score under 120 are on the pedestrian-unfriendly half of the list.
Individual sales show the same price premium. For example, Joe Cortright, founder of Portland-based Impresa, Inc., rated 90,000 recently sold existing homes in 15 metro areas across the country, using WalkScore's 100-point system. Each point of a property's Walk Score adds to $500 to $3,000 to the selling price compared a similar house in a less pedestrian-friendly place, according to Cortright's August 2009 report for New York City-based CEOs for Cities. "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 Cortright.
The walkable lifestyle may be a trend that has legs.