Expert Insight: Transit Projects Rev Up Interest in Nearby Housing
MRIS President and CEO, David Charron, provides expert insight on how transit projects are revving up interest in nearby housing in this Washington Business Journal article.
This is a region know for its history, people, culture and, yes, its traffic. The most recent study on the topic is credited to Texas A&M University, which in September granted the Washington area the dubious distinction of having the worst traffic in the country.
Despite the gridlock, I see great opportunity. As the roads get more crowded and rush hours get longer, we at MRIS are seeing a shift from sprawling suburbanization to mini urban hubs as more commuters look to plant their roots in clustering residential housing developments around transit centers.
For proof, look no further than upper Montgomery County, specifically surrounding the new Intercounty Connector. Home sales with a two-mile radius of the juncture of Route 355 and interstate 370 in Gaithersburg are averaging $347,394 - $30,000 higher than the same time last year, and the ICC may be a strong contributing factor to that rise.
We’re seeing a similar increase in home sales in Northern Virginia, where cranes are installing Metrorail’s new Silver Line, which will run into Loudon County. As construction takes place from Tysons Corner to Route 772, MRIS has started tracking home sales within a one-mile radius of proposed Silver Line stops, and we are already seeing homes selling an average three weeks faster and $70,000 more than they were before the Silver Line broke ground. Also, in the third quarter, the average home in this area sold in 44 days for about $550,000, compared with 66 days for just under $477,000 in the first quarter.
As we get closer to the Silver Line’s completion, another rise in property values is likely, as the convenience and speed of trips to the city become reality. New construction of high-density dwellings, mainly condominiums and apartments, can be expected around these new transit centers.
This “smart growth” allow residents to live closer to transit hubs and spend less time commuting, while also promoting an environmentally friendly lifestyle. In this case, not only is Metro opening doors, but it’s also opening a new housing market.
Transportation projects related to the base realignment and closure process are strengthening new areas of the market as well. We’ve been hearing about the BRAC implications on housing, but our data is starting to show the real impact.
MRIS researched the data within a five-mile radius of each of the three main BRAC areas and found that BRAC may be a positive influence on the housing market. Near Walter Reed, formerly the National Naval Medical Center, in Bethesda, the rental market is much stronger than a year ago, with an average of 35 days on the market. Prices are up too, with rents averaging $200 more per month compared with last year. Home sales in the areas around Lorton and Fort Belvoir are seeing an uptick, in part due to the current transportation project in the Route 1 corridor. Home sales are up nearly $15,000 in Fort Belvoir and $50,000 in Lorton near the National Geospatial-Intelligence Agency campus east.
All around the Beltway, transportation projects are making clear and positive impact on the housing market. We expect that to continue. According to a recent study by George Mason University, in the next 20 years the Washington area is expected to add more than 1 million jobs. To keep up with this growth, it is expected that at least 350,000 housing unites will need to be constructed.
New Metro lines, highways and transit centers are and will continue to bring myriad opportunities for single-family and mixed-use multifamily dwellings, and communities along these roadways and surely going to feel the most the most positive effects.