A little greenery can go a long way when it comes to property values
Most people enjoy a good tree, especially the rare one found inside city limits, but typically they leave it at that. Not so with Geoffrey Donovan of the U.S. Forest Service in Portland, Oregon. As Donovan told SF Gate in May, it's the fact that most people stop there that keeps him going:
People have an intuitive sense that trees are good things. … Being a soulless economist, I like to quantify things. "Trees are nice" isn't a very useful statement. You need to know how nice and in what sorts of circumstances.
In his quest to quantify, Donovan has investigated the influence of trees on neighborhood crime, electricity use, even the health of babies. Over the past few years he's focused much of his energy on measuring the effect trees have on home prices in Portland. The results suggest that "nice" and "good" can be pretty valuable words.
In the latest issue of the journal Urban Forestry & Urban Greening, Donovan and coauthor David Butry of the National Institute of Standards and Technology examine the impact of trees on rental prices. They looked up the asking price of about a thousand Portland rental homes on Craigslist, then collected data on the number and size of trees in the vicinity using Google Earth.
After controlling for the factors that someone examining the effect of trees on rent should control for — most notably, neighborhood desirability — Donovan and Butry determined [PDF] that a tree on the lot of a home increased its monthly rent by $5.62, while a tree on the street near the home increased it by $21. Not exactly budget-busting figures. When combined with previous research, however, the results point to a clear preference for trees among Portland residents.
In a 2010 paper in the journal Landscape and Urban Planning, Donovan and Butry found that a tree in front of a Portland property added more than $7,000 [PDF] to its sale price. Earlier this year another team of economists reported that walkability, in the form of nearby businesses, raises a Portland home's value by about $3,500 in a treeless neighborhood, but more than $22,000 [PDF] in a tree-lined one.
An interesting wrinkle in the two Donovan and Butry reports is that Portlanders clearly feel a tree is worth more near their property than on it — a "curb" appeal, as they put it. In the rental study a nearby tree was worth four times as much as one smack on the lot. The same effect occurred in the sale price study: a tree in front of a home added roughly $13,000 to the price of a neighboring home, almost double the value of the property it fronts. Donovan and Butry speculate that while tenants and home owners enjoy the presence of trees, they take into account the yard work that comes with trees on their own property and, in a sense, adjust their values of goodness and niceness accordingly.