Survey Reveals Light Rail and COVID-19 Impact on Denver Single-Family Homes DENVER, CO. Survey Reveals Light Rail and COVID-19 Impact on House Prices in Denver. A
Survey Reveals Light Rail and COVID-19 Impact on Denver Single-Family Homes
DENVER, CO. Survey Reveals Light Rail and COVID-19 Impact on House Prices in Denver.
A recent survey of single-family homes revealed the impact light rail access has on property prices in Denver, Colorado.
The survey compared house price appreciation in 2 groups.
Watson Buys employed a 3rd party company to perform the research and survey.
Houses were broken into 2 categories.
Category 1 were homes that were within 4 blocks of a light-rail train station.
Category 2 were houses that were further away than 4 blocks to a light rail stop.
Next, they looked at the average price of homes sold over the past 6 months in the 2 groups.
Finally, they looked at the average price of homes sold in the 2 groups over a 6 month period in 2015.
Shall we give you the results?
Average Price of Home Sold in Denver
We first needed to understand what appreciation was over the past 5 years in Denver.
Above you see property value appreciation from 2015 through 2020.
In 2015 the average price of a house sold for $408,357. This rose to $615,766 by the end of 2020.
This represents an increase of 50.79% over the 5 year period that was looked at.
Let’s keep digging into how this survey reveals light rail and COVID-19 impact on Denver house value
Survey shows the effect proximity to light rail did this to property value.
Denver houses within 4 blocks of a light rail station appreciated 56.96%
The average price of houses that were within 4 blocks of a light rail station in Denver that sold in 2015 was calculated for us as $387,698.
In 2020 we see a positive rise in sold prices, which was to be expected. By the end of 2020, the same group had an average sold price of $608,544.
Over the 5 year period that was looked at it was found houses that are located within 4 blocks of a light rail station in Denver increased 56.96%
Denver houses outside 4 blocks of a light rail station appreciated 51.53%
The average price of houses that were outside 4 blocks of a light rail station in Denver that sold in 2015 was calculated for us as $411,698.
In 2020 house prices in this group also increased. By the end of 2020, the group of homes that were more than 4 blocks away from a light rail station had an average sold price of $623,827.
Over the 5 year period that was looked at it was found houses that are located within 4 blocks of a light rail station in Denver increased 51.53%
Houses in Denver Within 4 Blocks of a Station Increased at a Higher Rate
Houses that are located within 4 blocks of a light rail station appreciated by 56.96%.
This is higher than houses outside the 4 block radius which appreciated over the same period at 51.53%
So what does this mean?
According to the statistical analysis provided to us, this is NOT a significant difference.
There are many studies that show similar and different results. Take each set of data with a grain of salt.
Further thoughts on house proximity to light rail in Denver.
I sincerely hoped to see a statistically measurable increase in value when a house was closer to a train station. To me, it made logistical sense.
However, from our study, I cannot draw this conclusion.
In a study focusing on Denver G Line only, they announced an increase of 102% since the announcement of the project. This might suggest more significant appreciation however other variables were also involved.
Light rail must add benefit to individuals before house value rises
For light rail to add value to the property it must first add value to the residents of the city.
Historically Denver has very low ridership, as measured by a percentage of the city when compared to other cities.
It was quoted less than 5% of Denver’s residents use public transit. Light rail only being a portion of that.
The reason experts believe that riders are low when compared is that, despite what Denver residents want to believe, traffic in the Mile High City is not that bad.
“It is very common for people in Chicago or New York to travel less than 10 miles in more than an hour, each day they drive to work,” said Trevor of a Transit Environmental Advocacy Group. He continued “A typical 10-mile drive, even in the worst that Denver has to offer is lower than this with the average drive time being less than half.”
Therefore it would seem the light rail in Denver doesn’t provide the value of decreased travel time, CURRENTLY.
The Future of Denver House Prices and Light Rail
Current map of light rail access to homes in Denver Colorado
You may have noticed I used the word currently at the end of the last paragraph.
Why do you say?
The population of Colorado is expected to increase by roughly 30% over the next 20 years.
If this happens we would see another 2 million people living in Colorado.
Trevor suggested that the lion share of these people will move to the front range and the added pressure could certainly tip the balance in the favor of living closer to a train station.
“As you know there are many factors to account for. Only a short time ago light rail was proving to be more popular only to be blown down by a global pandemic. Population growth is a sure way to increase traffic congestion which will ultimately result in more value perceived in riding light rail.
There are also more plans to add more light rail to Denver. This could also change current ridership numbers.
Denver House Prices, Light Rail Versus the Corona Virus
Denver residents not ready to ride the rail... yet
In a follow-up survey, we asked Denver residents if they were willing to ride light rail currently.
Of those who described themselves as regular users prior to COVID 19, only 17% said they are willing to ride at the moment.
Obviously, this is a headwind that light rail will need to power into for it to prove valuable to Denver residents.
Some surveyed suggested as the vaccine is rolled out and the effects felt they were most likely to return to light rail.
However, many also hoped they could continue to work from home.
Final Thoughts On How Light Rail Impacts House Prices in Denver
Survey Reveals Light Rail and COVID-19 Impact Final thoughts.
Currently, we were unable to show that houses near a light rail station in Denver appreciated more than houses that were further away.
Other cities that have been studied have shown a positive impact on house prices. The statistical significance I am unsure of.
Boston, Atlanta, San Diego, San Francisco, and Portland all measured greater gains in property value when closer to a railway station. They showed that if a house is within a quarter of a mile of a station then the value increased more.
Conversely, Miami, San Jose, and Sacramento did not show any house value increase as light rail access improved.
Trevor argues that this further demonstrates that light rail access in cities with a great traffic problem is more likely to have a positive impact on property value.
Other Denver Housing Market Reports, Expert Analysis and Insider Thoughts.
Denver House Prices Survey Predicts Significant Future Appreciation A recent survey of home-owners in Denver, Colorado highlights undeniable confidence and certainty in the future of