Does Curbing the Car Culture Really Boost Residential Real Estate Values?

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Interesting piece in the Wall Street Journal (sub req.) on Sunday raised a sacreligious question: are the billions we are spending on light rail really worth it, especially real-estate wise? Los Angeles and other auto-heavy Sunbelt cities such as Phoenix, Denver and Charlotte, N.C., are building out expensive light rail systems costing billions of dollars, funded by sales taxes and federal dollars. Urban experts tell us light rail encourages dense development, helps unclog traffic arteries, and boosts real estate values and development at station points. And of course, it’s so green.

In fact,

A 2014 study of the Phoenix area’s light-rail system co-written by Arizona State University professor Michael Kuby showed an increase in residential and commercial property values after the system was introduced, extending more than a mile from stations.

But not so in Charlotte, where a 2012 study of property values near the light-rail system stations there produced a “mixed bag of results.” Apparently a few high end developers put up some fancy digs near the stations that would have been built anyhow. As for creating a real estate boom, light rail may be like robbing Peter to pay Paul: just pilfers real estate values from another part of the city:

Randal O’Toole, a transportation and land use expert for the conservative Cato Institute, said he believes local governments are investing in light rail only “because the federal government is offering money for it.” If proximity to transit lines does boost property values, “it does so at the expense of values somewhere else in the same city or urban area,” he said.

Of course, we have a DART station on Central Expressway at CityPlace. And what do we have across from it? A big box Sam’s Club. Yeah, don’t get me started. Haskell is becoming a whole new world. But no, we couldn’t have some mixed-use something with housing, developer went for the quick buck.

Of course, transportation researchers remind us the  “primary goal of rail projects isn’t to boost property values, but to increase the options for how people get from one place to another.”

But like a top of the line Viking, rail line stations do make real estate more attractive, even if you never use them. Researchers at UC Berkeley say the most successful rail systems are concentrated near stations with high populations and employment.

Millennials hate driving, too: Census Bureau data analyzed by economist Jed Kolko, a senior fellow at UC Berkeley, and formerly the chief economist and VP of analytics for Trulia, says today’s 18 to 34 year olds are all about car alternatives.

You know my theory: Millennial’s spent too much time in cars while we chauffeured them all over.

But still, does it boost property values to be next to a rail station?

Chris F. Campbell, a longtime Roosevelt Row resident and owner of real-estate firm RooPho Realty LLC (in Phoenix), said the neighborhood was growing before (the $1.4 billion) light-rail opened, and the rail line tends to be much slower than driving.

Roosevelt Row is an Arts District, and we know in Dallas how that draws residents even without rail.

The gist: the feds are going to spend our bucks on light rail come hell or high water, or at least until local fight back. Even now in Los Angeles, which has a car culture equal to or surpassing Dallas/Fort Worth, residents are tiring of the congestion and putting roadblocks up for developers who want to come in with tall, dense projects that will create yet more traffic — this even with LA’s billion dollar plus light rail. At least one group wants a two-year moratorium on high density projects in LA, and mixed use developments near station stops have been voted down.

Could this happen in Dallas? I have heard a lot of chatter that Uptown and parts of Oak Lawn are getting too congested, were poorly zoned, and maybe we need to cool it on the high density. Maybe we, like Angelenos, are just beginning to get out and walk:

“It used to be that no one walked anywhere in Los Angeles, even if you were going to the corner store five blocks away,” Mr. Han (owner of a craft beer restaurant) said. “But slowly that mentality has been changing, and it’s giving people more options.”

mm

Candy Evans

A real estate muckraker, Candy Evans is one of the nation’s leading real estate reporters. She is also the North Texas real estate editor for Forbes.com, CultureMap Dallas, Modern Luxury Dallas, & the Katy Trail Weekly. Candy has written for Joel Kotkin’s The New Geography, Inman Real Estate News, plus a host of national sites. Constantly breaking celebrity real estate news, she scooped former president George W. Bush's Dallas home in 2008. She is the founder and publisher of her signature CandysDirt.com, and SecondShelters.com, devoted to the vacation home market. Her verticals have won many awards, including Best Blog by the venerable National Association of Real Estate Editors, one of the nation’s oldest and most prestigious journalism associations. Candy holds an active Texas real estate license but does not sell. She is on the Board of Directors of Braemar Hotels & Resorts (BHR).

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  1. CRITIC says

    People walk when there are no parking options or the expected car valet tip costs as much as their first beer

    • mmCandy Evans says

      Interestingly, in the WSJ article it said that LA has always, always encouraged driving and parking by requiring vast parking from developers. Feeding the car culture, if you will. But they may be looking to change all that. I am mixed: I understand the need to curb driving, better for the environment etc. But we in Dallas are in the “in-between” stage and it is a pain — we still do not have reliable, efficient transit, so we need our cars (or car services) to get around, and there is less and less parking. Walking is great except between June and September. Bicycling is an option that’s growing, but we need more bike lanes. Ultimately when all built out it will be better but getting there is so frustrating.

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