The name of the game in real estate has always been: location, location, location. Where you buy a home is often as important, if not more important, than how large the house is or how nice the bathroom or kitchen fixtures are. Some location decisions are easier than others. Buying a home near a leaky nuclear power plant isn’t likely to give you the same return on your investment as a home near good schools and parks will. Having access to quality shopping is also a sure-fire way to add value to a housing investment. But, what if your choice is between two brand-name retail outfits? What is the best decision? RealtyTrac, a real estate data and analytics firm, took a look at the impact Walmart (#1 U.S. retailer) and Target (#6) locations have on local housing markets. The company examined three measurements that should be top-of-mind for any potential homebuyer: home values, price appreciation (how much the home’s value increases), and property taxes. The markets surveyed either had a Walmart or a Target in the same ZIP code. Here are the results:
Are you buying a home near Walmart? While you will enjoy a lower average purchase price ($178,249) and will be paying significantly below-average property taxes (averaging $3,146 per year), you’ll see the downside if you live in the home for any length of time. In addition, average appreciation is significantly lower in Walmart neighborhoods, compared to Target ZIPs.
If you’re targeting (pun intended) home in a community with one of the 1,793 Target locations, it might be tough to break in as a first-time buyer with an average price tag 72% higher ($307,286) than Walmart-adjacent homes. You’ll also have to pay significantly more in property taxes each year - $7,000 on average. However, the payoff will be nearly double the price appreciation – 27%, compared to just 16% for Walmart communities.
Bottom line – do your research not just on the home you’re looking at, but the community it’s located in! Click here to read more.