Living near public transportation has become more and more expensive over the last several years, a new study from the National Association of Realtors and the American Public Transportation Association revealed.
The study showed that home prices and rents in neighborhoods located within a half-mile of public transit services rose much faster than those in areas located farther from public transit.
In the report, seven metros with access to heavy rail, light rail and bus transit were analyzed.
Residential properties in the Boston; Hartford; Los Angeles; Minneapolis-St. Paul; Phoenix; Seattle; and Eugene, OR metros near public transportation had a 4 to 24% higher median sale price between 2012 and 2016 than comparable homes in areas not located near public transportation, according to NAR.
In metros like Los Angeles, home listings in that specify public transportation have steadily increased in the last few years, according to Trulia.
Rents have also gone up in these locations at higher rates than in other areas.
According to the report, the demand for rentals near public transportation drove an outsized increase in rent in those locations. The study showed that rent was between 2 and 14 percentage points higher in the public transit station areas than in neighborhoods away from transit.
But as the study notes, that increase is good for landlords, but not so good for renters who want to live near a subway station, etc.
“An increase in residential rents within transit sheds has encouraged developers and frustrated consumers,” the study noted. “Cities will need to keep working on housing affordability and land use policies to mitigate displacement from high-value public transit.”
On the other hand, living near public transportation allows (or forces) residents to live without a car, thereby saving them the money associated with owning a car.
According to the study, transportation costs in transit-oriented areas are significantly lower than in other regions, with an average annual savings of $2,500 to $4,400 for the typical household.
In fact, one in four households in close proximity to transit does not own a vehicle.
Some cities are working to increase the supply of affordable housing near public transportation. For example, Seattle has a plan to add affordable housing near public transit hot spots.
Meanwhile, commercial properties near public transit also saw price gains, four of the regions specifically had median sales prices per square foot increase between 5 and 42%.
“Access to public transportation is an extremely valuable community amenity that increases the functionality and attractiveness of neighborhoods, making nearby communities more desirable places to live, work and raise a family,” said NAR 2019 First Vice President Charlie Oppler. “The results of our report, conducted over multiple years alongside the American Public Transportation Association, should reiterate to policymakers at all levels of government the importance of investing in modern, efficient infrastructure that facilitates growth and helps our nation keep pace in a rapidly evolving world.”