The Effect of High-Rise
Development on Property Values
(This material submitted by - A Neighborhood Angel)
Developers say that high-rise condo buildings in a residential area will
increase property values. If the developers are right then residential
neighborhoods should openly embrace the developers' suburban high-rise
vision for the 21st century.
But neighbors say that high-rise condo buildings in a residential area
will decrease property values and destroy their neighborhood. If the neighbors
are right, then they must correctly turn high-rise developers away from
their precious neighborhoods.
WHO IS RIGHT?
According to the University of New Orleans Real Estate Market Data Center,
the neighbors are right.
Property values increase faster in areas without high-rise buildings.
10 yr. Growth in Average $ Sale Price for Single Family Residences
- *Areas as defined by the New Orleans Multi-System Listing
- These five (5) areas comprise all of New Orleans Council District
- The Lakefront high-rise condominiums are in area 69.
- The Audubon Park high-rise condos are in area 63.
- The 3 areas with the largest growth in average single family sales
prices were the areas WITHOUT high-rise condominiums.
- The areas where high-rise condos do exist had the LOWEST growth rates
in average sales prices for single family residences.
- Source: New Orleans and the South Central Gulf Real Estate Market
Analysis; Volumes 27 - 36; by Wade R. Ragas, PH.D., Director, Real Estate
Market Data Center and published by University of New Orleans.
Generally speaking, the optimum developmental impact on surrounding properties
occurs with conformity - when all structures are somewhat similar. If
a development conforms to the neighborhood it is likely to have a positive
impact. Renovating an old house in a historic district, for example, will
positively impact the entire district.
Conversely, if a development does not conform to the neighborhood then
it is likely to have a negative impact. A fast-food restaurant or a high-rise
building, for example, in the middle of a residential block will have
a negative impact on the neighborhood.
High-rise buildings can certainly add value to a neighborhood and impact
positively on neighboring properties. In areas like downtown, for example,
where high-rises are welcomed and plentiful, high-rises tend to exert
a positive impact on neighboring parcels.