Property Values and Landowner Concerns
Indiana information adds to national trends with value of trails to homeowners.
From the B & O Trail in Indiana
Studies and surveys from throughout the U.S. document the beneficial effects of trails and greenways on adjacent and nearby property values. Feedback from experienced Indianapolis realtors concerning the new Monon Trail suggests the same benefits will occur locally.
"We had record sales in 1997 of homes in Forest Hills," says Chip Somerville (Somerville Team at Re/Max, phone 317.469.1900) referring to the area on the west side of the Monon Trail south of Broad Ripple. "Customers aren't yet concentrating their searches toward trail proximity, but adjacent neighborhoods set sales value records last year," Chip reports. "There's just tremendous interest in the Broad Ripple area."
Kurt Meyer (Baseline Real Estate, phone 317.579.6061) concentrates exclusively on commercial properties, especially in the Broad Ripple area. "The market is incredibly strong, with many inquiries from people wanting to be in this specific area," Kurt reports. The result is "pretty high prices that can be a shock for less experienced business owners," he explains. His experience is that the Monon Trail has had "a very positive effect on commercial values."
National market research of prospective home buyers reveals 78 percent rated natural open space as either "essential" or "very important" (American Lives Inc., 1995). A similar study of the Indianapolis market was conducted at the 1996 Home Show by Company of Pilgrims Inc. under contract to Davis Homes. In response to the question "What amenities are of tangible value in your home buying, renting or remodeling plans," 83 percent of Indianapolis consumers said they were "interested" or "very interested" in bicycling-walking trails. For comparison, in the same survey tennis/basketball courts and playgrounds received 73 and 55 percent ratings respectively.
Over the last decade, and in multiple U.S. regions, there have been a number of published studies of the relationship of real estate values to trail proximity. In Boulder (CO) total selling prices increased $4.20 to $10.20 per foot of proximity, beginning at 3200 feet from the greenway (1978). Proximity to Salem (OR) greenbelt parcels - privately owned in this case - added a premium of $1,200 per acre, in comparison to similar properties 1,000 feet or more from the greenbelt (1986).
Clustered housing designs incorporating green space were contrasted with conventional subdivisions in a 1990 study in Amherst/Concord (MA). The former appreciated at a compound rate of 22 percent, versus 19.5 percent for the latter. By 1989, this translated into a average differential selling price in excess of $17,000. Also in Massachusetts, a 1982 study of Worcester home sales documented a average premium of $2,675 for properties adjacent to park land versus properties 2,000 feet removed.
In Dayton (OH), park proximity added 5 percent in one study area and 7.35 percent in another (1985). Similarly, property values declined with distance from Phildelphia's Pennypack Park: from a 33 percent premium for adjacent parcels, to 9 percent at 1,000 feet, and finally to 4.2 percent at 2,500 feet (1974).
A 1973 study in Columbus (OH) revealed premiums ranging from 7 to 23 percent for homes facing the park, contrasted with homes a block distant.
Another source of insight to questions of property values and trail adjacency is surveys of residential and business property owners. A comprehensive 1992 study conducted by Penn State University under contract to the National Parks Service included data from three very different locales: the rural Heritage Trail (IA), the suburban-exurban Saint Marks Trail (FL) and the urban Lafayette-Moraga Trail (CA). Landowners along the three trails reported that their proximity to the trails had not adversely affected the desirability or value of their properties.
The City of Seattle (WA) surveyed homeowners and real estate brokers along the 12 mile Burke-Gilman Trail in 1987. They found that properties near, but not immediately adjacent to the trail sold for an average premium of 6 percent. Of those interviewed, 60 percent believed that trail adjacency would have a neutral or positive effect on the selling price of their property.
Neutral-to-positive expectations for property values were held by 87 percent of adjacent neighbors to the Luce Line Trail (MN). In the same 1988 study, 56 percent of farm neighbors held that same view, and 61 percent of suburban neighbors. The most positive expectations were held by the newest owners. Appraisers and real estate brokers claimed that trail adjacency was a positive selling point for "suburban residential property, hobby farms, farmland proposed for development, and some types of small town commercial property."
The popularity of trails and greenways is growing. For example, a series of studies conducted by the Rocky Mountain Research Institute in Denver (CO) found that "those who said they would pay extra for greenbelts and parks in their neighborhood rose from 16 percent in 1980 to 48 percent in 1990."
"The economic case for trails and greenways gets steadily more self-evident," said Rory Robinson, Indiana representative of the Rivers, Trails and Conservation Assistance Program of the National Parks Service. "Our agency has compiled and summarized much of the published research on this subject and this is available to the public," he concluded. The NPS study is entitled "Economic Impacts of Protecting Rivers, Trails, and Greenway Corridors" (Fourth Edition, 1995) and is available through the American Trails website.
For more information on the B & O trail see: http://www.rcdi.org/index.html
March 25, 2003
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