Historic Listing Can Boost Home Value
By Susan Straight
September 14, 2002
In recent years, several studies have concluded that a historic designation increases values in a neighborhood. A 2001 study of
Abilene, TX, conducted by researchers from Pennsylvania State and Rutgers universities, shows that the benefits of historic
designation outweigh the costs for residents. It also found that the additional property tax money the government brings in is greater than the costs associated with preservation tax incentives. Another study, by the research center of the Government Finance Officers Association, found that historic preservation activities increase property value, create jobs, and boost tourism and expenditures by owners of buildings that operate as historic attractions. The center, headquarter in Chicago, provides public finance research and advisory services to communities. A different study, published in the journal of the American Real Estate and Urban Economics Association, found that historic designation influences adjacent owners to maintain or rehabilitate their properties. The National Register is “the nation’s official list of cultural resources worthy of preservation,” according to the National Parks Service, which maintains the register. Its 75,000 listings include not only such recognizable landmarks as the White House and the Capitol, but also humbler properties and neighborhoods across the country. Lyon Village was built mostly by developer Frank Lyon in the 1920s and 1930s. In December, it became the first early 20th century Arlington neighborhood to be listed on the Virginia Landmarks Register; it was named to the National Register in May. Residents may notice no immediate difference in practical terms because the National Register designation carries no restrictions on building additions or renovations. One of the reasons historic designation is thought to boost home value is that it encourages residents to maintain their property in its current state. But inclusion on the National Register is not enough to enforce home maintenance.The real protection against both degradation and alteration of homes in a neighborhood comes from local historic preservation protections rather than National Register designation, said Constance E. Beaumont, director of state and local policy for the National Trust for Historic Preservation. When an area has local historic designation, a county-appointed board usually oversees approval of any renovations to the exteriors of neighborhood homes. To guarantee the structures in a historic district do not deteriorate, some nationally designated districts seek out local designation.
Local ordinances “protect significant historic property to make sure it lasts for others to enjoy,” said Clare L. Cavicchi, historic preservation planner for the Montgomery County Department of Park and Planning. Some neighborhoods pursue local designation to preserve the integrity of the existing structures and follow it by national designation for the cachet. Residents of historically designated communities have “a strong sense of who they are,…a sense of specialness and rootedness that is lacking in many communities,…a desire to protect those things they share, ” said Richard C. Collins, founder of the Institute for Environmental Negotiation at the University of Virginia.”A neighborhood wouldn’t receive historic designation if there wasn’t a sense of something worth identifying and protecting to begin with,” he added. Collins notes that protection at the local level is the real hedge against internal alteration of a neighborhood.
The economic impact of the designation depends on the characteristics of the site, Collins said. In an urban setting, a historic designation generally causes prices to go up, along with a sense of security and value.
What tends to boost values is when a group of houses or neighborhood decides to get together and work for historic designation to stabilize the neighborhood and make sure the lade use does not change. The benefit of historic designation is often in protecting current zoning laws, and thus, protecting current residents.
Historic designation benefits a neighborhood more than a single building or homeowner. Edward Coulson, an associate professor of economics at Penn State said, “if it’s just your own house, you’re tying your hands in exchange for a little plaque.” However, if neighbors bond together to designate the whole neighborhood, they are each providing promises to each other that “this house will be kept up.”
Collins acknowledges that historic designation itself can create a self-fulfilling perception of value. “If people think something has value and quality, it will translate into price,” he said. But for now, Lyon Village is going to bask in its new glory.
“We’re just proud of our neighborhood,” historian Ditty Boaz said.