The Whole Foods Effect may be a myth, says RealtyTrac p2
8/14/2015 | Real Estate Blog
We are still talking about home values in neighborhoods with Trader Joe’s markets and Whole Foods markets. The online real estate research company RealtyTrac recently reported that while Whole Foods neighborhoods did see an overall 34 percent increase in value, Trader Joe’s neighborhoods fared better with an overall increase of 40 percent. The researchers measured the increase from the date of purchase to the date of the study.
The Philadelphia Business Journal reports that Philadelphia’s Main Line towns do not follow the national trend. For example, far from matching the country’s 40 percent increase, Trader Joe’s homes in Ardmore logged increases of just 22 percent. In Wynnewood, in the Whole Foods camp, home value increases were lower than the national average — just 28 percent compared with 34 percent — but with a less intimidating gap between the local and national numbers.
Local results also looked at Wayne’s home values. Wayne is home to both a Trader Joe’s and a Whole Foods. The values increased by 24 percent.
The advantage is wiped out, however, when property taxes are factored in. Wynnewood paid nearly twice as much in property taxes as Ardmore, giving the advantage to Whole Foods. Nationally, Trader Joe’s neighborhoods paid almost 60 percent more.
RealtyTrac admits that there are too many variables to show cause and effect between either chain and home values. Perhaps the better question is the effect of a nearby grocery store on home values. In the city, especially a city like Philadelphia with so many neighborhoods in want of revitalization, the current emphasis on walkability almost demands a local food market. A grocery store can make or break a neighborhood.