property”? How many times have you wished for hard evidence to support your contention that in
fact the opposite is true?
In 1995 the state historic preservation office of South Carolina sponsored an authoritative economic study of house prices to
address this very point. Among the most striking findings: homes located in two nationally and locally designated historic
districts increased in price at a rate almost 25 percent faster than did homes in the community at large.
John A. Kilpatrick, a lecturer with the Center for Real Estate and Urban Economic studies at the University of South Carolina
College of Business, coordinated the project in cooperation with Susan McGahee and the late Nancy Meriwether of the
Historical Services Division, South Carolina Department of Archives and History. Columbia, S.C., a city with a population of
just over 100,000 was selected as the subject area because of its proximity to the university and to the state historic
preservation office, which provided work space for interns from the university’s graduate program in applied history.
In establishing the scope of the study, key concerns were the reliability and the validity of the data. Unlike similar studies
conducted elsewhere in the United States, which used property value estimates from such sources as tax assessment records
or building permits, the Columbia study used actual sales transactions to establish market values. Since one criterion for the
validity of such a study is the collection of a statistically meaningful amount of data, Kilpatrick opted to utilize actual transaction
figures over a period of about 12 years from early 1983 to mid 1995.
Fortunately, USC’s Center for Real Estate has a history of working with the Columbia Multiple Listing Service, a private
corporation to which most residential real estate companies subscribe and which serves as a repository for residential sales
data throughout the Columbia market.
The student interns collected sales data on every home within the historic districts that had sold at least twice during the study
period. Using these transaction prices and times between sales, Kilpatrick developed an index of house price appreciation
within the historic districts. Using market-wide sales data, he also constructed an index of price increases for the market as
Analysis of the data led Kilpatrick to conclude that, for the “two residential historic districts in Columbia…investigated for
price appreciation characteristics relative to surrounding properties of the period 1983 – 1995… (and) utilizing a repeat sales
methodology applied against actual transaction prices of historic properties, it appears that historic properties have an
average rate of return higher than (that of) the Columbia market as a whole.”
To verify the Columbia findings, Kilpatrick and the state historic preservation office have now begun a study working with
similar Multiple Listing Service data in Beaufort, S.C., a coastal town of roughly 15,000 people. Located in a quasi-resort
area, Beaufort has both a large historic district and considerable new construction in the surrounding area. Given the mix of
property types and the data available in Beaufort, Kilpatrick believes that this study will also begin the process of developing
a useful appraisal methodology. The results of the second study should be available in the Spring of 1997.
In the meantime, the Columbia study has already proved useful to preservationists. The findings
were presented at the annual conference of the Georgia Trust for Historic Preservation in February.
They have been included in a training workshop for real estate appraisers. And the state historic
preservation office plans to use this information in a training program for local historic preservation
commissioners that will be broadcast by satellite throughout South Carolina.
Tom Shaw is the local assistance coordinator in the Historical Services Division, South Carolina Department of Archives and
History. For more information, or to obtain a copy of “House Price Implications of Historic District Designations” by John A
Kilpatrick, contact Tom at 803-734-8610 or call John Kilpatrick at 803-782-5109.