Factors of Real Estate Appreciation - Zibi

Factors of Real Estate Appreciation

We’ve all heard the old adage about real estate being a sound investment. But, not all properties are created equal. There are key considerations to be taken before jumping into your next purchase. We’ve done some extensive research and here are some key factors that help lead to real estate appreciation:

Green Spaces

The proximity of parks and green spaces to a community not only provide a better quality of life for its residents, but it can also increase real estate value. The Atlanta BeltLine and New York’s High Line are notable examples, where real estate sales within immediate proximity of both parks outpace similar properties by as much as double digits. A new article in The Wall Street Journal mentions that “condo prices [near the High Line] have risen to between $2,000 and $3,000 a square foot from about $1,000 in 2009” in what is being dubbed as the “High Line’s halo effect,” with real estate values 75% higher than the rest of downtown Manhattan.[i] Furthermore, properties abutting or fronting passive parks have demonstrated a 20% increase in value, whereas proximity to active parks can see a 10% increase on properties 2 to 3 blocks away.[ii]

Proximity to Stadiums

It’s no secret that we’re excited about the redevelopment of LeBreton Flats, not least because the construction of a brand new stadium is planned within the first 5 years. What does this mean for new residents? Firstly, they’ll be able to walk to and from games, concerts, and events, but it also means interesting premiums for homeowners in neighbouring communities. According to a recent study, “homes in neighbourhoods close to new stadium builds (or proposed stadium builds), on average, have premiums ranging between 3% and 15%,” meaning interesting resale opportunities for prospective buyers.[iii] Learn more about what the redevelopment of the LeBreton Flats means to Zibi and its residents here.

Master Planned Communities

A master planned community is one that is usually larger in scope than traditional developments, and one that includes a number of recreational amenities and an interesting housing mix. Research shows that “residences in master-planned communities command a 5 to 10 percent price premium over comparable” housing, offering you a significantly better investment.[iv] With plans for no less than 9 parks and plazas, 40% of the land dedicated to commercial and retail space, two community centres, and a robust cultural offering, residents at Zibi will never want to leave.

Active and Public Transit

Reliance on cars is a major contributor to atmospheric pollution and is becoming a vastly outdated mode of transportation. But for many, active and public transit is simply not an option. Luckily for city-dwellers, the Ottawa-Gatineau region is about to see a significant increase in transit option. While the benefits of active and public transit are many, one that isn’t often considered is real estate appreciation. Firstly, walkability can greatly contribute to the value of your property, with a recent study showing a $3000 premium for every WalkScore point.[v] Secondly, with Ottawa’s new light rail train (LRT) system, including a nearby station, residents can expect an “increase [in] residential real estate prices upwards of 40%”.[vi] Just one more reason buyers should act sooner than later.

LEED Architecture

LEED certified construction offer countless advantages, including lower utility bills thanks to a reduction of 50-60% of your energy usage. But did you know that they also offer higher resale value? In a new report by TD Economics, units in “LEED-gold certified buildings, the resale price is between 12.2 per cent and 14.9 per cent more” than their non-LEED counterparts.[vii] Both your conscience and your wallet will thank you, in the short and long run.

Sill undecided? Read why Zibi is built for both the left and right side of your brain.

[i] Baranel, Josh (2016, August), The High Line’s ‘Halo Effect’ on Property
[ii] Crompton, J.L. (2011), The impact of parks on property values: A review of empirical evidence
[iii] REIN (2015, October), The Impact of Stadium Construction on Real Estate Values
[iv] Spivak, Jeffrey (2012, February), Increasing Home Sales in Master-Planned Communities
[v] Pivo, Gary and Fisher, Jeffrey D. (2010, February), The Walkability Premium in Commercial Real Estate Investments
[vi] Delancey, E., d’Hoste, A., Fisher, M., & Joshua, M. (2005), Hiawatha light rail transit: A cost-benefit analysis
[vii] DePratto, Brian (2015, May), The Market Benefits of ‘Green’ Condos in Toronto

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