Home values have risen dramatically over the last twelve months. The latest Existing Home Sales Report from the National Association of Realtors puts the annual increase in the median existing-home price at 5.6%. CoreLogic, in their most recent Home Price Index Report, revealed that national home prices have increased by 6.7% year-over-year.
CoreLogic broke appreciation down ever further into four price ranges which gives a more detailed view than simply looking at the year-over-year increases of the national median home price.
The chart below shows the four tiers and each one’s growth from July 2016 to July 2017 (the latest data available).
It is important to pay attention to how prices are changing in your local market. The location of your home is not the only factor in determining how much it has appreciated over the course of the last year. Lower priced homes have appreciated at greater rates than homes at the upper ends of the spectrum, due to demand from first-time home buyers and baby boomers looking to downsize.
Bottom Line
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The website HouseLogic recently came up with a list of items that impact the value of a home. We all know that highly rated schools are a bonus for nearby housing, but did you know that good schools have a lot in common with Wal-Mart and public transportation, for example? Advising buyers toward being near any of these might add thousands to a home’s value, but the cost of admission could be higher than a home, “not near a Wal-Mart.” Here’s some of what HouseLogic uncovered:
County or state parks and golf courses
A public park might boost the property value of nearby homes by 8 to 20 percent. A recent study looked at more than 16,000 home sales within 1,500 feet of just under 200 public parks in Portland, Oregon, and found home values increased on the average:
Natural areas: $10,648
Golf courses: $8,849
Specialty parks: $5,657
Urban parks: $1,214
Living near a Wal-Mart
A study by the University of Chicago noted that living within a mile of a Wal-Mart that stays open 24 hours a day could raise your home’s value by 1 or 2 percent, and living within half a mile could boost your property value by an additional 1 percent. But, I don’t know why this wouldn’t naturally also apply to Target or other similar stores.
Walkability
According to a 2009 study from CEOs for Cities, being close enough to walk or just a minutes away from schools, parks, stores and restaurants will raise your property value anywhere from $4,000-$34,000. That sounds great, but those walkable neighborhoods are usually in town. They are therefore due to location inherently more expensive and once again the cost of admission to get into them is going to be higher.
One of the “most walkable” sections of our market, for example, the average sales price over the past 15 months was $231,000. The average sales price for homes just outside this section of the MLS, a 10- to 15-minute commute by car, dropped to $161,200.
Additional dwelling spaces
Whether it’s an in-law apartment or carriage house, having a separate living space can increase a home’s value by 25 to 34 percent, according to a study of 14 properties with accessory dwelling units in Portland, Oregon. In our local market once again I saw a more moderate 4 percent to a mind-blowing 44 percent increase based on homes sold in the most desirable locations with an in-law suite. The article noted, and I think it is valid too, that an income stream can be generated, too, for buyers of these properties. I know in a local college town that for “decades” law students would lease space like this in town to be near campus.
