New real estate figures show access to transit is increasingly becoming an asset for homebuyers. The Minneapolis Area Association of Realtors has studied the impact of the METRO Blue Line LRT on housing prices, and says more and more, people are considering transit when evaluating where they want to live.
“We regularly hear from our members who work with millennials and boomers alike that today’s buyers want the option to take transit to the airport, to entertainment, to work, to sporting events or even for an evening out with friends or family,” said David Arbit, Director of Research and Economics for the Minneapolis Area Association of Realtors. “Today’s buyers want the option to not own a car, or if they do own a car, the option not to use it every single day.”
Arbit says his research shows that the value of homes in neighborhoods near Blue Line stations in Minneapolis continue to be higher than homes in neighborhoods not connected to the region’s first LRT line. In January 2015, the median value in an LRT-connected neighborhood was $220,000, and the median-valued home was $194,000 in a non-LRT neighborhood. (See more about the research (PDF) beginning on slide 20.)
“The Minneapolis light rail neighborhoods continue to outperform the rest of the city,” said Arbit.
Dynamic likely to be replicated along Green Line and planned expansions of LRT system
Arbit says realtors are now seeing a similar dynamic along the METRO Green Line LRT. Home values have performed better in the Green Line area than in the city of St. Paul as a whole and when compared to the metro region as a whole since the line’s 2014 opening. He says he’s expecting the same to happen in communities along the planned Southwest LRT line, with the exception of the Kenwood neighborhood of Minneapolis, where the price effect is expected to be minimal due to low turnover rates of homes.
“I think values in St. Louis Park and Hopkins will perform quite well, similar to values along the Hiawatha line. I’d expect Minnetonka and Eden Prairie values to perform in the middle, somewhere between St. Louis Park/Hopkins and Kenwood,” he said.
Arbit said he expects to find property values in LRT-connected neighborhoods along the proposed Blue Line Extension in north Minneapolis, Golden Valley and Crystal to “perform better than their control group and better than the region just as we found on Hiawatha.”
Balance needed to ensure affordable housing options along transit lines
Met Council Member Gary Cunningham says while the increase in home values demonstrates the desire for people to live near transit lines, it also underscores the need to ensure there is available affordable housing along public transit. Median household incomes within a half-mile of the planned Green Line Extension’s 15 stations is $50,580, well below the metro-wide figure of roughly $80,000.
“We have a great need for more affordable housing in this region,” said Cunningham. “While many critics claim residents along Southwest corridor are wealthy compared to other residents in the area, the fact is that there are many working-class families in need of affordable housing all along the line. We need to work together with stakeholders to ensure the people who need to access transit can do so.”
Hennepin County Commissioner Jan Callison agrees there’s a misperception that the cities along the Green Line Extension are more prosperous. “If you dig below the impression, you’ll see they’re quite diverse, and many of them have a history of affordable housing.”
A Hennepin County task force is working to ensure that one-third of the new housing units expected along Green Line Extension by 2030 are affordable for people with low and moderate incomes to prevent gentrification. Projections estimate 11,200 new apartments, condos, and homes.
Residents increasingly seeking out housing near transit lines
A national study by the Rockefeller Foundation finds that 66 percent of millennials say access to high-quality transportation is one of their top three priorities when considering a move to another city.
“People rely on public transit to get to work, to school, to opportunities,” said Met Council Chair Adam Duininck. “It’s clear that many people are deciding where to live and work based on access to transit. If we are going to compete for the top talent in the country, we must continue to build out our regional transit system and provide people more options to get around.”
Older residents are also increasingly attracted to housing near public transit. Marvin Plakut is President and CEO of Episcopal Homes. He says many residents sought out the independent living center at the Fairview Avenue Station in St. Paul because of its proximity to the Green Line.
“LRT had a major positive impact on our Episcopal Homes campus and our residents and staff. It brought more than just transportation and increased independence. It brought excitement and vibrancy and a sense of newness and urban chic,” said Plakut. “Our Episcopal Homes campus expansion filled up prior to opening our doors last year, and we have long waiting lists. Nearly all guests inquiring about our offerings are saying that a significant part of their interest is a result of the light rail line stopping right in front of our campus door.”