Grocery Stores Have The Goods (For Real Estate)
While it is no surprise that homeowners want to maximize the value of their property, it might come as an eye-opener that proximity to certain grocery stores can substantially improve the value of real estate.
According to a recent study from ATTOM Data Solutions, major grocery store chains like Trader Joe’s, Whole Foods, and ALDI, were found to increase home prices. In fact, across the country, the average home value near Trader Joe’s is $608,305, compared to $521,142 near Whole Foods and $222,809 near ALDI. The average home seller return on investment over a five-year span with these grocery stores was 37%, with homes near a Trader Joe’s having an average home seller ROI of 51%, compared to homes near a Whole Foods with an average home seller ROI of 41% and ALDI at 34%.
Why It Matters
The findings are compelling because homebuyers, whether they are solely looking to invest in real estate or simply seeking to raise a family, may count on their purchase paying off by just living near certain grocery store chains as those chains seem to provide a quality return on investment and secure higher home equity. For an investor, real estate near certain grocery store chains contributes to strong home flipping returns and attractive home price appreciation. In short, proximity to certain grocery stores can substantially improve the values of residential property nearby, particularly if the stores offer high quality service and products.
Historically, residential home buyers sought properties nearby schools that they wished for their children to attend. In terms of increasing home values, it almost seems as though purchasing real estate near certain grocery chains may have the same importance or may have usurped purchasing near desirable schools.
Among the core tenants of real estate is location … location … location! After all, residential real estate purchasers who choose the “best” locations will have an asset that appreciates more than the norm. With that in mind, whether you are an investor looking for more bang for your buck or a homebuyer looking to purchase residential real estate near conveniences such as grocery chains, look for a well-branded chain like Trader Joe’s, Whole Foods, or ALDI as those grocery chains seem to have a significant statistical positive effect on property values.
From the Trenches,