Southwest Light Rail Line & Property Values

How Close is Too Close?

I expected the question sooner or later, but I officially received my first, "how is the [Southwest] light rail line going to affect my property value?" inquiry from a Cedar Lake-area homeowner this week.

No doubt, the impetus was a series of public hearings the last few weeks that seemingly increase the odds that the likely route will run between Cedar Lake and Lakes of the Isles on its way to Eden Prairie.

The principal alternative, which now seems to be receding, would go through a more densely populated part of Minneapolis well to the east.

Three Variables

To answer the property value question, I think it's useful to first identify the variables.

I see three: 1) timetable; 2) proximity; and 3) number and location of stations.

One. Timetable. The Southwest line is projected to open between 2015 and 2017. Factor in budget and building delays, and the actual start date could well be later.

Given that the average homeowner moves every 7 years, it's likely that many affected homes will change hands once or even twice before the line is finished. So, at least as of Fall, '09, the impact is relatively remote.

Two. Proximity. While we're talking about light rail, an active rail line is still going to be noticeable to nearby homeowners (noise, vibration, etc.).

So, how close is too close?

Nuisance vs. Convenience

The answer is partly subjective -- note all the people under flight paths near the airport. And yes, supposedly there are people who think hearing trains is "romantic" (personally, I've always thought that was an urban myth).

However, my guess is that closer than 150 feet or so would be a negative for most homeowners.

Put it this way: if you can see the tracks from your house . . . you might be too close, at least for some Buyers.

Beyond that, proximity is likely to be a plus -- assuming that the corridor is not simply a thoroughfare. Which leads to . .

Three. Number and location of stations.

If there are stations located at reasonable intervals, so that light rail actually serves the surrounding neighborhoods, the effect is likely to be a boon for the area -- if not the immediate homes.

Imagine: you can step out your front door, and be minutes from the lakes, uptown, downtown, a job in the suburbs -- without a car!

Additionally, in many cities that already have light rail (think, Washington, DC and the Metro; the Bay Area and BART; Chicago and the L, etc.), the stations spur surrounding development and services, becoming magnets themselves.

All Aboard?

However, if the Southwest light rail line is simply an express thoroughfare to and from the 'burbs, the effect on adjacent areas of Minneapolis will be much more negative.

I doubt it would be as dramatic (traumatic?) -- light rail lines have a smaller footprint than freeways -- but the construction of 35W in South Minneapolis in the '60's bisected whole neighborhoods and started a cycle of blight that continues through today.

It's hard to imagine that happening near Cedar Lake and Lake of the Isles, because the area's character and demographics are much, much different than the corridor along 35W.

However, it's certainly something for urban planners to take note of.

P.S.: Want a more systematic approach? This paper examined the effect of the Hiawatha Line, running between Downtown Minneapolis and the Mall of America, on surrounding property values.