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4 Ways the Design of a Neighborhood Affects Real Estate Values

By Guest Author | August 19, 2016

We know that lots of factors affect property values, but some are less obvious than others and knowing about them can be helpful in improving and creating neighborhoods. Here are four design elements that are often overlooked.

Brunswick Crossing, Porch, rendering, stoop


A University of Washington paper shows that neighborhoods planned with "walkability" in mind have consistently higher values. Walkability consists of placing residential properties within a half mile from offices, retail spaces, and parks. Walkability was found to increase prices of both single-family and multi-family residential developments.

Rear-Entry Alleyways

To avoid sprawl and traffic, many communities have residences that share a rear alleyway. This can have detrimental effects on property values. A study by the University of Texas found that homes with rear-entry alleyways sold for 5% less than homes with traditional suburban parking. They concluded that this lower value is the result of alleyways shrinking available backyard space, and the commonly expressed belief that alleyways behind houses attract criminal activity. This suggests that planners can retain better property values by allowing space for conventional street, driveway, and lot parking.

Historical Properties

Developing in historical districts or near historical properties can be challenging. Often strict guidelines must be followed, but according to a study by several New York academics, residences in historical areas sell for 20% more than comparable non-historical properties. Improving and building these neighborhoods requires the skills of civil engineers, who literally shape our world. A professional with a master’s degree in civil engineering can be a great resource for understanding how to build a property in a historical area while following the proper regulations.

Detention Basins

During the building of a new neighborhood, detention basins—or holding ponds—are often put in to control possible flooding. How these basins are designed can affect real estate prices. An article in the journal Landscape and Urban Planning distinguishes between basins that are "uni-use"—a simple flooded depression that are easy to create but are often considered eyesores—and "multi-use" basins, which turn the holding pond into a green site. The latter may involve integrating the basin into a park or other recreational setting. This approach adds to property values of homes with views of these ponds, while homes with views of "uni-use" basins have lower values.

Planning a neighborhood is a difficult task, but empirical data about how design elements like the above affect values can guide professionals in creating satisfying, prosperous communities.

About the author: Anica Oaks is a freelance writer and web enthusiast. Read some of her published work on her Google+ page.

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