The LeBron Effect: Home Values When Celebrities Move In
This was huge news, of course, since James is probably the biggest NBA free agent of all time, and many analysts seem to think the Chicago Bulls would be a great fit for the Cleveland Cavaliers star. Highland Park, many quickly pointed out, was close to the Berto Center in Deerfield, which is where the Bulls practice.
The rumor ended up being nothing more than a piece of juicy-yet-unfounded gossip. But after the Highland Park neighborhood's name appeared repeatedly in the press, the real question at hand became: Do celebrities actually help the home values in the neighborhoods they move into?
"I don't know of there being any actual value added to nearby homes by virtue of a celebrity moving in," said Bob Goldsborough, who writes the "Elite Street" column for the Chicago Tribune and updates the "Big Time Listings" blog for Berg Properties.
While this may happen when celebrities promise to move into high-rises in Manhattan, "in most cases, it seems, the celeb never actually moves in," Goldsborough noted. "But in ordinary neighborhoods, no, I would say that there's little to no evidence that a celebrity's proximity helps or hurts neighboring home values."
The exception? "Dennis Rodman's oceanfront duplex that he owned in Newport Beach, Calif., some years back; it was a party house, and it drove the neighbors nuts and probably depressed home values as well."
Matt Silver, broker associate with @properties, had similar perspectives on the matter. While there was a lot of "hubbub, for obvious reasons," surrounding James' rumored interest in Highland Park, Silver had not seen significant effects when so-called rock stars move into neighborhoods. "On many levels, it's a wash."
CEOs with school-age children have a more significant impact on the neighborhoods that welcome them, according to Silver. "Athletes could care less" about the impact they have on the areas they move into, especially since they're rarely home anyway. Silver added that celebrities moving into neighborhoods potentially have "a little bit more of a negative impact," since their presence may cause people to start "tooling around the neighborhood."
Besides, most residents really don't care if a celebrity moves into their neighborhood. "They're more interested in: How much did they pay for it? Did they get a discount because of their celebrity status?"
According to Trulia, the San Francisco-based real estate search engine, the median sales price for homes in Highland Park was $428,750 from February through April -- down $36,250, or 7.8 percent, from the same period last year.
See homes for sale in Chicago at AOL Real Estate.