By Bill Holloway
A new study in the Journal of Transport and Land Use documents changes in residential property values for homes located within one mile of Charlotte, North Carolina’s, new light rail line – formerly a freight rail facility. The study analyzed home values over a period of 11 years divided into four time periods: 1) prior to any concrete plans for a light rail system (1997-1998), 2) during the planning phase (1998-2005), 3) during the construction phase (2005-2007), and 4) since the system has been operational (2007-2008).
The 9.6-mile light rail line analyzed in the study is Charlotte’s first light rail facility, making it an ideal case study for the property value impacts of rail transit service in new markets. Although many studies have documented the relationship between a home’s value and its proximity to well-developed rail transit systems, the relationship between property values and proximity to semi-developed systems is less certain.
The results indicate that the price discrepancy that existed during the first time period between homes less than a quarter mile from the line, which were somewhat lower, and those between one quarter and one mile from the line – likely due to the presence of industrial land uses along the rail line – narrowed considerably over the 11-year period. At the same time, home prices in both areas trended upward throughout the study period. While there are a number of potential explanations, the authors cite improved transit accessibility, an improved image of the area following the construction of the light rail system, or an increasing number of multifamily and commercial properties in the vicinity of the light rail stations as potential causes of the increasing property values near the new light rail line.
Although more research is needed on how transportation investments affect property values, this study represents an important step in quantifying these effects in lower-density communities that do not have well-developed transit networks.
For additional information on the economic impacts of transportation investments, see SSTI’s report Economic Effects of Public Investment in Transportation and Directions for the Future.
Bill Holloway is a Transportation Policy Analyst at SSTI.
By Bill Holloway