A Twitter pal asks: “How much do you think proximity to LRT stations will affect prices in the short and long terms?” Great question!
The answer depends on the proximity of the property to the new station during and after construction, whether the neighbourhood is wealthier or poor, and also what the city plans to do in terms of housing policy near the new LRT stations.
Let’s deal with proximity first.
If your home is 500- 800 metres (800 metres is roughly half a mile) from an LRT station, your property’s value is likely to go up by quite a bit (the studies show a range from around 11% to 99% so it’s hard to predict exactly what the increase would be. My guess is 25-30%). Further than that, and it’s unaffected.
But at 400 metres or less, paradoxically, prices actually decrease, according to a BC report done by Real Estate Intelligence. And at 275 metres, the drop can be quite significant, according to US studies. That’s due to issues around noise, crowds, and an increase in petty crime. However, even with that range, properties in wealthy neighbourhoods see an increase in property values: the declines are more likely to impact already poorer areas.
In the short term, close proximity to construction can depress values due to uncertainty about noise, traffic disruption during the construction phase, underground excavation and tunnelling, and so on. The studies I read don’t examine the impact on condo prices, but I suspect those go up after the construction is over even if the buildings are within 275 metres of a light rail station, due to the greater number of residents and the sheer convenience of having public transit at the door.
In Ottawa, realtors began advertising proximity to the LRT as part of the listings as soon as the locations of the substations were identified.
But as you can see, the impact on prices depends on a variety of factors: how close your property is to the new station during and after construction, the type of property, and whether you live in a wealthy neighbourhood or a poor one.
There is one other consideration worth mentioning. Ottawa has announced that community housing will be built close to the new LRT stations as part of its intensification policy. That could be a neutral or it could depress prices of nearby properties during and after construction. We just don’t have enough information yet about size and location of these units to know.