Economic Impacts of Historic Preservation

Summary

  • Belmont Values Historic Preservation
  • Research shows that designation, such as being placed on a list similar to the List of Significant Buildings, receives the same economic benefits as other forms of historic designation
    • Designation draws attention to the building – indicates that this is a special place
    • National trends have shown that property values have increased because of historic designation programs – the reasons for that effect are difficult to isolate.  For residential areas, buyers have appreciated the unique and special character of the properties and have perceived the protective measures afforded by local historic designation as a means to ensure the stability of the community. 
  • In general, conversations with and research into comparable communities indicates that impacts on property values have not been a concern and therefore, such analysis  has not been conducted
  • Belmont Assessor, Dan Dargon – “I have not seen any significant impact due to the Demolition Delay Bylaw on property values in the last year.”
    • Limited supply in Belmont market has driven prices up
    • Limited supply makes it difficult to determine if a regulation effects property values
  • Charles 'Chuck' Clark, Belmont Planning Board, Managing Director, Hilco Real Estate Appraisal, LLC – The real estate markets in Belmont and Eastern Mass. are too hot/chaotic to determine if a given regulation has had an impact on property values.
  • Massachusetts Historical Commission, Christopher Skelly, Director of Local Government Programs – Not aware of any studies relating to Demolition Delay Bylaws’ impacts on property values. 
  • Brookings Institute – Economics and Historic Preservation: A Guide and Review of the Literature (2005)
    • “Preservation projects can be profitable; and preservation policies do make sound fiscal sense.”
    • Every analysis on economic impact of protection has indicated that values have been maintained at worst, and usually are enhanced, because of historic district status.
    • “In New Jersey, it was found that, ‘Properties on the national, state, or local historic registers have a market value of $6 billion, of which about $300 million can be attributed to the value-enhancing effect of historic designation.’”
    • “Residential parcels located within historic districts (in Philadelphia) appear to attract a substantial price premium of 131%.”
    • “Each $1 million spent on non-residential historic rehabilitation creates two jobs more than the same money spent on new construction. It also generates $79,000 more in income, $13,000 more in taxes, and $111,000 more in wealth.”
    • “Studies across the country have shown that historic preservation acts as a powerful economic engine, creating tens of thousands of jobs and generating significant household income.”
  • Wellesley – Adopted a Demolition Delay Bylaw on April 24, 2017
    • Research shows that owners of older homes experience a much greater increase in value than those of newer properties
    • Out of 14 communities, Belmont’s existing housing stock had the 3rd (Behind Newton and Brookline) highest rate of increase at 32.5% between 2011-2015
    • New construction suppresses growth in value because it increases supply
    • www.wellesleyma.gov/pages/wellesleyma_histdist/Demo.pdf
  • Brookline, Tonya Loveday, Preservation Planner – Believe the bylaw has positively impacted the local economy and therefore has not analyzed the impacts to property values.
  • Concord, Elizabeth Hughes, Town Planner - Concord Assessor indicated that the Concord Demo Review Bylaw has had no effect on property values from an assessing point, and local realtors have indicated the same. 
  • Benefits of Residential Historic District Designation for Property Owners, Jonathan Mabry, Ph.D., Historic Preservation Officer, City of Tucson - "Higher property values and rates of appreciation are important economic benefits of historic district designations of residential neighborhoods."