According to a new book Zillow Talk: The New Rules about Real Estate, homes near a Starbucks location appreciate at a better than average rate compared to homes further away from a Starbucks. Furthermore, Starbucks seems to be the cause of the increases in values rather following them. It is not that Starbucks are plunking down stores in popular areas, or that Starbucks are early arrivers to gentrifying areas. The study looked at homes located within a about a kilometre of newly opened Starbucks and found that after five years they appreciated at a significantly higher rate than those outside of this radius. It also found, like studies of mass rapid transit (LRT), the closer the home is to a Starbucks, the more desirable it becomes.
Personally, I think it is a chicken and an egg argument. Furthermore it doesn’t matter. I have a new rule to add to the 365 Rules about Real Estate. If you want your home to appreciate at a better than average rate:
Buy a home near a Starbucks.
These big companies (like Starbucks) know what they are doing. They have accountants and actuaries and urban planners pouring over (no pun intended) maps and demographics. They are not going to set up shop in a seedy neighbourhood (unless they are early arrivers).
Starbucks locations in Kitchener Waterloo
When you look at a map of Kitchener Waterloo, you will find 12 Starbucks locations.
Two are in Chapters stores
One is in Uptown Waterloo
One is in a high traffic and pedestrian area (University and King)
The rest are in strip malls. There was one (the 13th) in Target but I guess that will close.
Two things are notable
1) There isn’t a Starbucks in downtown Kitchener.
I know there are lots of great independent coffee shops. Is that why? Is Starbucks coming?
2) There are Starbucks locations at both ends of Laurelwood, arguably Waterloo’s most popular neighbourhood.
Further reading
The Starbucks Effect: How does the chain decide where to open shop? Its New York real-estate guru, David Firestein, showed us the green mermaid’s secrets.
Photo credit
Map credit
Zillow as a Resource
