I'm not one who touts the virtues of Wal-Mart very often, but fair's fair...
- By Carole VanSickle |
June 1, 2012 There are plenty of people out there who claim to hate big-box stores
like Wal-Mart for driving smaller, local businesses right out of
business, but if you are selling your home, then you should be jumping
for joy if there is a Wal-Mart close by. Although critics have claimed
for years that the “Wal-Mart Effect” hurts property values, when that
theory was tested by two economists they found that in fact, the
opposite was true. After analyzing more than 600,000 real estate
transactions near 159 newly-opened Wal-Mart stores over five years, they
determined that homeowners located within half a mile of the new store
saw home value increases between two- and three percent (an average of
$7,000 at the time), while homeowners located between half a mile and a
mile away saw home prices rise one- to two percent (an average of
$4,000)[1]. Furthermore, the team pinpointed when those increases begin
to happen: after the announcement and during the building process. “This
suggests that it was the building of the Wal-Mart itself that caused
the change in housing values that we find…[rather than] Wal-Mart
building in areas that are experiencing housing price increases,” said
the researchers in their report.
Of course, it is important to note that the study was conducted
between 2001 and 2006, when most home prices were still rising. And
rural areas were analyzed lightly because there was not much housing
data available in these areas[2].
[1] http://realtormag.realtor.org/daily-news/2012/05/31/walmart-effect-home-prices
[2] http://economy.money.cnn.com/2012/05/30/when-walmart-comes-to-town-home-prices-go-up
