How much is walkability worth? An intriguing new study suggests that people are willing to pay considerable premiums for houses in neighborhoods that are highly walkable — that is, where you can actually get to nearby stores, schools, and parks without having to hop in the car. The study, conducted by a group called CEOs For Cities, looked at 90,000 homes in 15 different markets in the US, matching up home sales data with “walkability” scores from WalkScore.com. In 13 of the 15 areas studied, homes in highly walkable neighborhoods sold on average for $4000 to $34,000 more than homes in neighborhoods of average walkability. The pattern held in locations as diverse as Chicago, Tucson, and Jacksonville, Florida; only in Las Vegas were more-walkable neighborhoods less desirable than less-walkable ones. To the author of the study, Joseph Cortright, this suggests that neighborhood walkability is “more than just a pleasant amenity,” and deserves far more attention from politicians and other urban leaders. Is this study simply saying that people pay more for homes in high-density metropolitan areas? Well, no; the study controls for this effect, as well as for a host of other factors (like home size, neighborhood income levels, and access to jobs) that might have affected the results. Source: HousingWire
A bill that helps home buyers afford energy improvements and encourages banks to offer a discount on loans to pay for reducing energy usage passed the U.S. House in June and could pass the Senate in the fall. The American Clean Energy and Security Act of 2009 requires Fannie Mae and Freddie Mac to offer discounts on home loans that include monetary incentives for making a home more energy efficient. These discounts, which are already in effect at some lenders like J.P. Morgan Chase & Co. and Bank of America, include savings on closing costs for homes that have Energy Star appliances. The Federal Housing Administration is offering a plan through its approved lenders that allows borrowers to add the cost of making efficiency improvements into the loan, but the extra money doesn’t count toward determining how much loan a borrower can qualify for. For instance, a borrower who adds $5,000 to a $100,000 loan to afford new Energy Star appliances would only have to qualify for $100,000 – not $105,000. Source: The Wall Street Journal
Recent data illustrating steady home prices and rising sales for weeks have led economists and analysts alike to indicate a perceived bottom, or stabilization, in the US housing market. New market analysis out of Credit Suisse suggests the US residential housing sector may be past the point of stabilization and is now recovering vital signs. Demand is returning on higher affordability and the federal first-time homebuyer tax credit, according to Martin Bernhard, of Credit Suisse’s private banking, investment services and products divisions. “On a national level, we think that the turning point could have been reached,” he said. But several factors including unemployment rates and foreclosure levels may pressure these positive developments, Bernhard said in market commentary last week. New house supply is low as housing construction slips. The existing house side of the market, which is about 10 times as large as the market for new homes, according to Credit Suisse, remains pressured by levels of foreclosure inventory. The risks posed by the foreclosure pipeline may pressure prices in the short term, but the pricing correction achieved poses long-term investment benefits. “Given the sharp correction in house prices over the last three years, we think that there now exist interesting investment opportunities in the US housing sector,” Bernhard said. Source: HousingWire
