Study: Gated community homes sell for more


Study: Gated community homes sell for more

 
BOCA RATON, Fla. – July 1, 2016 – Homes in gated communities command significantly higher prices – almost $30,000 on average – compared to similar homes in communities without a gate. However, gated neighborhoods' additional amenities can also reduce sale prices because they bring maintenance costs that outweigh the benefits of the amenities, according to recent research published by the American Real Estate Society (ARES).
"This study provides clear evidence that homes in gated communities sell at a premium relative to comparable homes in non-gated communities," says ARES Publication Director Ken Johnson, Ph.D., a real estate economist at Florida Atlantic University's (FAU) College of Business and co-developer of the Beracha, Hardin and Johnson Buy vs. Rent Index.
The study examined 11 gated communities and a sample of matched non-gated properties, using a data set of housing sales in Shelby County, Tennessee. The researchers found that residential properties in gated communities command a noticeable price premium of approximately $30,000, most likely resulting from actual or perceived benefits associated with additional privacy, homeowner associations' tighter controls on maintenance, home design and the added assurances against crime and other undesirable activities.
"Additional maintenance costs associated with these amenities often outweigh their benefits, and it appears that while a gate has value, additional neighborhood amenities do not always provide additional value," says Mark A. Sunderman, Ph.D., University of Memphis.
So, what does all this mean to buyers and sellers?
"The long-held belief that gates add value is supported by the data, as long as the impact of the amenities is properly factored in," Johnson says. "This should set buyers' minds to rest as to whether or not they are actually receiving a boost in value when they purchase inside a gated community."
© 2016 Florida Realtors®

Comments

Post a Comment

Popular posts from this blog

Don’t Get Caught in the Rental Trap!

Image
         Don’t Get Caught in the Rental Trap! There are many benefits to homeownership. One of the top ones is being able to protect yourself from rising rents and lock in your housing cost for the life of your mortgage. Don’t Become Trapped Jonathan Smoke, Chief Economist at realtor.com, reported on what he calls a “Rental Affordability Crisis.” He warns that, “Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.” In the Joint Center for Housing Studies at Harvard University's 2015 Report on Rental Housing, they reported that 49% of rental households are cost-burdened, meaning they spend more than 30% of their income on housing. These households struggle to save for a rainy day and pay other bills, such as food and healthcare. It’s Cheaper to Buy Than Rent In Smoke’s article, he went on to say, “Housing is central to the health and well-being
Read more

5 Reasons You Should Sell This Summer

Image
5 Reasons You Should Sell This Summer Here are five reasons listing your home for sale this summer makes sense. 1. Demand Is Strong The latest Buyer Traffic Report from the National Association of Realtors (NAR) shows that buyer demand remains very strong throughout the vast majority of the country. These buyers are ready, willing and able to purchase… and are in the market right now! More often than not, multiple buyers are competing with each other to buy a home. Take advantage of the buyer activity currently in the market. 2. There Is Less Competition Now Housing inventory is currently at a 4.2-month supply , well under the 6-months needed for a normal housing market. This means, in the majority of the country, there are not enough homes for sale to satisfy the number of buyers in that market. This is good news for home prices. However, additional inventory could be coming to the market soon. There is a pent-up desire for many homeowners to move, as th
Read more

Renting or Buying… Either Way You’re Paying a Mortgage

Image
Renting or Buying… Either Way You’re Paying a Mortgage   There are some people who have not purchased homes because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s. As Entrepreneur Magazine, a premier source for small business, explained this month in their article, “ 12 Practical Steps to Getting Rich ”: “ While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich .” Christina Boyle, Senior Vice President and head of the Single-Family Sales & Relationship Management organization at  Freddie Mac,  explains another benefit of securing a mortgage vs. paying rent: “With a 30-year fixed rate mo
Read more