Walking the Walk

walking walk

 

More than just a pleasant amenity, the walkability of cities translates directly into increases in home values. Homes located in more walkable neighborhoods—those with a mix of common daily shopping and social destinations within a short distance—command a price premium over otherwise similar homes in less walkable areas. Houses with the above-average levels of walkability command a premium of about $4,000 to $34,000 over houses with just average levels of walkability in the typical metropolitan areas studied.

This paper explores the connection between home values and walkability, as measured by the Walk Score algorithm. Walk Score measures the number of typical consumer destinations within walking distance of a house, with scores ranging from 0 (car dependent) to 100 (most walkable). By the Walk Score measure, walkability is a direct function of how many destinations are located within a short distance (generally between one-quarter mile and one mile of a home). Our measure of walkability reflects the convenience and proximity of having shopping and cultural activities close at hand, as well as the value households attach to mixed-use neighborhoods.

Using an economic technique called hedonic regression, we estimate how much market value homebuyers implicitly attach to houses with higher Walk Scores. We looked at data for more than 90,000 recent home sales in 15 different markets around the nation. Our statistical approach controlled for key characteristics of individual housing units (their size, number of bedrooms and bathrooms, age and other factors), as well as for the neighborhoods in which they were located (including the neighborhood’s income level, proximity to the urban center and relative accessibility to employment opportunities).

After controlling for all of these other factors that are known to
influence housing value, our study showed a positive correlation between walkability and housing prices in 13 of the 15 housing markets we studied. In the typical market, an additional one point increase in Walk Score was associated with between a $700 and $3,000 increase in home values. In one market (Las Vegas) there was a negative correlation—housing prices decreased with higher Walk Scores, and in one market (Bakersfield) there was no statistically significant correlation between prices and walkability after controlling for other factors.

These results show that consumers and housing markets attach a positive value to living within easy walking distance of shopping, services, schools and parks. The property value premium for walkability seems to be higher in more populous urban areas and those with extensive transit, suggesting that the value gains associated with walkability are greatest when people have real alternatives to living without an automobile.