Access to newly fashionable clothing and a killer cash-back rewards program aren’t the only reasons to be happy you live near a Target store.
A new report finds that houses near a big red bullseye are worth more than average and do better on resale. Among homeowners who sold their houses last year, those who lived near a Target saw a 27 percent average increase in the price of their home since its purchase, worth an average of more than $65,000, a RealtyTrac analysis finds.
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By comparison, homes near a Wal-Mart saw value increase just 16 percent since purchase, for an average gain of nearly $25,000. The average appreciation for all zip codes was 22 percent, worth an average of $41,000.
The average value of homes located near a Target was $307,000, 72 percent more than the average value near a Walmart, and 40 percent above the national average.
The study compared homes that were in a zip code with just one of the two stores. It did not account for the how prices changes specifically after a Target had been built.
While it’s tempting to conclude that a nearby Target store boosts home values, the causation isn’t clear. It’s just as likely (if not more so) that Target tends to build stores near wealthier neighborhoods, which have seen better home appreciation in recent years for reasons unrelated to store location. And Wal-Mart may build its stores in less affluent areas, where home values are lower. As the saying goes, retail follows rooftops, not the other way around.
