Open space said to lift home prices
Colorado analysis shows buyers' willingness to pay 20-plus percent premium
News WiseMay 9th, 2013
Homes in neighborhoods that incorporate protected open space command prices 20 to 29 percent higher than those without open space, says a new study by a Colorado State University multidisciplinary research team that included Wildlife Conservation Society scientist Sarah Reed.
Conservation development is an approach to the design, construction, and stewardship of a development that protects natural resources while also providing social and economic benefits to people. The properties in this study specifically incorporated protected open space into the design of the neighborhood.
The study, which was funded by the National Association of Realtors and CSU's School of Global Environmental Sustainability, evaluated home sales in more than 200 developments across Colorado. Researchers chose Chaffee, Douglas, Larimer, Mesa, and Routt counties as a representative sample of Colorado communities and because they had large numbers of conservation developments.
Results showed that buyers paid prices 20 to 29 percent higher for homes in conservation development projects when compared to conventional rural residential projects across the five counties.
"Our study shows that people are willing to pay more to live in subdivisions that incorporate conservation elements," says Reed, a study co-author, faculty affiliate in the fish, wildlife, and conservation department at CSU, and associate conservation scientist with the Wildlife Conservation Society. "This may provide an extra incentive for developers, real estate professionals, and lending institutions to market this type of development."
Other results from the study indicated that increased sales prices for homes in conservation development projects varied among counties (9 to 51 percent) and that a greater number of homes and lots sold per conservation development project versus conventional development projects between 1998 and 2011.
The study appeared in the peer-reviewed Journal of Sustainable Real Estate.
Reed and Liba Pejchar, assistant professor in the Warner College of Natural Resources, served as principal investigators on the project. The lead author of the study paper was Christopher Hannum, a CSU economics doctoral student.
Reed and Pejchar lead a Global Challenges Research Team on conservation development, a group of 20 researchers from nine departments in five colleges at CSU that is synthesizing data on existing conservation development practices, establishing a rigorous scientific basis for evaluating conservation development designs and policies, and engaging with land use planning, development, and conservation practitioners to inform the design of future projects in the United States and around the world.
Future projects at CSU will assess whether conservation development subdivisions are achieving conservation benefits.