Amenities That Jack Up Sales Prices

Amenities That Jack Up Sales Prices

DAILY REAL ESTATE NEWS | WEDNESDAY, JULY 01, 2015
Americans will dig deeper in their pockets and shell out more cash to live near top-notch schools and in safer neighborhoods with access to retail and "artificial amenities," according to a new study published in the Journal of Urban Economics. In analyzing 2,000 neighborhoods across the country, researchers found that home buyers are willing to potentially spend thousands of extra dollars for these amenities.
A regional funding increase of $1,000 per student in schools is associated with a $570 annual increase in what people are willing to pay for a home in the neighborhood, though "this number is likely biased from well-funded areas being nicer or having more desirable residents," researchers note. 
However, unsafe neighborhoods will bring in much lower offers from buyers. A 10-point increase in the murder rate — from 10 to 20 deaths per 100,000 residents annually — is associated with an annual drop of $1,000 to $1,600 in what people are willing to pay, according to the study. 
Buyers will also pay more incrementally depending on how many bars and restaurants there are in the neighborhood. Each establishment per 1,000 was found to be worth an annual $170 increase in what people say they're willing to pay for a home. That number may also reflect a desire to live near a variety of stores and entertainment areas, researchers note. 
A neighborhood's size, density, and "artificial amenities" — those that are created by the residents — were also found to be important, even more so than living near a natural environment such as mountains and coastlines, according to the study. 
"Because artificial amenities are largely produced by local residents, they may reflect the desirability of the populations themselves," the authors note. That means residents are willing to pay not only for the neighborhood itself but the access the neighborhood affords them to other people, jobs, and amenities, according to a report on the study by The Atlantic.
East Oahu, Hawaii, is the study's top desirable location, with households willing to sacrifice 25 percent more of their pay than the average American in order to live there. California cities such as Marin, San Mateo, San Francisco, Santa Cruz, San Jose, and Oakland follow closely behind East Oahu, as well as parts of Colorado and Washington State. 
Source: “How Much Are You Willing to Pay to Live in America’s Best Neighborhoods?” The Atlantic CityLab (June 29, 2015)

Popular posts from this blog

Advice Young Adults Need to Avoid Buyer’s Remorse

Advice Young Adults Need to Avoid Buyer’s Remorse March 4, 2019 Most young adults have financial regrets about their home purchase, a new Bankrate survey shows, but much of their grief could have been avoided with proper planning. That’s where you come in: Younger buyers have a need for more professional guidance about the costs of homeownership. Sixty-three percent of millennial homeowners—more than any other generation—expressed buyer’s remorse, most often pertaining to closing costs, home maintenance, and other hidden expenses, according to the survey of more than 2,000 consumers. “When you buy a house, you can’t call the maintenance company or a landlord to fix major issues; it’s all on you,” says Luis Rosa, a financial planner in Henderson, Nev. Extra expenses, such as needing a new air conditioner, furnace, or water heater, often catch first-time buyers by surprise, Rosa adds. “I always advise home buyers to create savings buckets and open a savings account
Read more

Housing Slowdown Doesn’t Scare First-Time Buyers

Housing Slowdown Doesn’t Scare First-Time Buyers March 4, 2019 Despite recent declines in home sales, sluggish growth in single-family home construction, and mounting affordability concerns, first-time buyers are outperforming other segments of the market, according to a new report released by Genworth Mortgage Insurance. “The first-time home buyer market has been more resilient during the [housing] slowdown compared to repeat buyers,” writes Tian Liu, chief economist at Genworth Mortgage Insurance. About 482,000 first-time buyers purchased homes in the fourth quarter of 2018. Though that’s 3 percent lower than a year ago, it bests the 7 percent year-over-year decline in repeat buyer activity, according to the report. “This is a reminder that first-time home buyers differ from other buyer groups in terms of why they buy,” Liu notes. “Their purchase decisions are more likely driven by the fact that many are starting families and reaching peak homebuying ages. Even
Read more

What Buyers Should Ask After a Home Inspection

What Buyers Should Ask After a Home Inspection October 9, 2018 You are here Home News and Commentary Daily News What Buyers Should Ask After a Home Inspection Share Facebook Twitter LinkedIn Print October 9, 2018 After an inspector has finished a home report, buyers may feel overwhelmed by any flaws that might have been found. That’s why it’s important they take the opportunity to learn more so that they can move forward confidently in the transaction. A recent article at realtor.com® recommends home buyers ask their inspector clarifying questions like: “I don’t understand this; what does it mean?” or “Is this a major or minor problem?” and “Do I need to call in another expert for a follow-up?” Home inspectors are bound to uncover something in a home; no home is perfect. But the majority of the problems they uncover will likely be minor. Have the home inspector clarify which problems fall within the “minor” or “major” categories. Keep in mind: “The inspector can't tel
Read more