Property Values in Tucson
There was a study done recently to determine the effect of homeless shelters on property values. If you are living in the Tucson AZ area, you know that our wonderful weather often draws people from all walks of life. How a person becomes homeless is not the point of this article, but rather to describe the effects of homeless shelters on property values in Tucson.
While there has been no exhaustive study done in the Tucson area regarding property values and the effect of nearby homeless shelters, there was recently a study produced in New York. This study encompassed 8 years and thousands of home sales in the Manhattan area.
The Study Showed Property Values Affected
What the study revealed was shocking. Although Realtors and Real estate investors have long suspected that the presence of homeless shelters would negatively affect the resale value of a property.. it was unknown by how much the property value would be affected.
After this study has been produced, now it is clearer for homeowners as well as potential home purchasers how much the value of a home is effected by the proximity of a homeless shelter.
Does the location of a homeless shelter affect the sale price of your home? Today on Karl Buys Houses, we’re going to find out. Stay tuned.
Homelessness has become quite an issue amongst Americans today. From coast to coast, it doesn’t matter really where you’re from. If you’re talking about skid row in LA county all the way up to Manhattan in New York, the homelessness problem has become a national issue. So here in Tucson I’m frequently confronted by homeowners who are asking themselves, “Does the presence of homeless people near me affect the value of my home?” And what I’ve often told them is the jury is still out. But today there was recently a study that I found that I wanted to share with you that address this very issue.
Let me quote from it for you. A link to this study is provided below, but let me quote it for you. It says, “Does proximity to a homeless shelter affect residential property values in Manhattan? Summary: The mayor’s plan to open 90 homeless shelters in neighborhoods throughout the city has triggered vocal opposition in some of the affected communities. Concerns about crime, quality of life and lack of services for the prospective residents have been among some of the most common reasons given for the community resistance. Also, frequently cited is the negative effect on residential property values, but with little empirical research to support or refute the assertion. Given this lack of information, Manhattan Borough President Gale A. Brewer asked IBO to study the effects of homeless shelters on nearby residential property values. Using sales data covering the years 2010 through 2018 on condominiums and one to three family homes in Manhattan, IBO modeled the effect of proximity to homeless shelters on sales prices, controlling for other factors that also influence prices.
An econometric analysis confirmed the common assumption that residences located close to a homeless shelter sell at lower prices than comparable residences further away. In particular, they found a residence situated within 500 feet of a congregate shelter for adults sold for an estimated 7.1% less than a similar residence sold at a comparable time located 500 to a thousand feet from a shelter for adults. In dollar terms this means that if a property more than 500 feet from a shelter sold for 1 million, a comparable residence within 500 feet of a congregate shelter for adults sold for approximately 929,000.
To put it in another way, a property located within 500 feet of a shelter for homeless families with children sold for an estimated 6.4% less than a similar residence, 500 to 1000 feet from a shelter for families with children. Proximity to multiple shelters had an even bigger effect. Residences located within a thousand feet of two or more shelters sold for an estimated 17% less than a comparable property located within a thousand feet of a single shelter.”
It’s difficult to tell what the effect of homelessness will be on an individual’s home, but one thing is for certain, according to these studies, it does appear that homelessness shelters do affect values of homes. If you’ve got a property that you’re looking to sell that you don’t want anymore, feel free to give me a call. I’ll be happy to give you a help in any way I can. Thanks!