Most buyers, when looking for a new home, often consider the usual suspects: square footage, number of bedrooms, amount of sunlight…sometimes even the ‘walk score.’
Here’s another factor to keep in mind as well: coffee shop proximity.
It turns out that easy access to quality java has broader implications. Call it the ‘Starbucks Effect’ (perhaps the “Tims” effect in Canada): Proximity to a local coffee shop has a very real, and positive, effect on home values, new data shows.
Coffee houses emerged early on as a big predictor of future home value. Within a quarter mile…close enough to smell the coffee brewing.
How much faster? Statistics in the U.S. show, leading up to 2014, homes adjacent to the local Starbucks almost doubled in value, up by 96 %. Those further out appreciated by 65 % over the same period.
And apparently not all coffee shops are created equal. Researchers compared homes near Starbucks locations to those near other popular coffee shops adjacent properties also outperformed the wider market, rising 80 % over 17 years, but they lagged those in the shadow of Starbucks.
Of course, there is a chicken-or-egg question here: Are coffee shops causing a boost in home values, or are the popular chains merely locating in promising neighborhoods that are already on the upswing?
Humphries’ discovery: Within the first few years of opening, Starbucks locations are actively helping local home values. After that, the outperformance of the broader market tends to diminish
The coffee shop is hardly the only symbol of neighborhood gentrification. Researchers have found other amenities can have an even more powerful effect on home values.
Nearby specialty grocers, for instance, can lead to a 17.5 % home-price premium, according to research…that compares to a more modest 4.5 % for coffee shops. In that sense the Starbucks Effect might be more accurately be termed the Whole Foods Effect.
Other factors which significantly affect nearby home prices are cinemas, wine shops and garden stores.
For potential homebuyers, it’s like heading into an exam with the answer key. Assuming that significant market research has gone into every store opening, buyers can piggyback on those positive conclusions.
If you’d like more info, to find out about training/coaching or to learn about how you can participate in cash flow real estate, schedule a free 15 minute call by filling out the form below. And we assure you, no pressure or sales will accompany the call. Look forward to speaking with you!