Excerpts from "Historic Districts Found to Lift Values"
In historic districts across New York City, from Fort Greene in Brooklyn to Mount Morris Park in Harlem, homeowners are severely restricted in how much they can redevelop or alter their properties, so that the character of their areas will be preserved.
Those restrictions, while often called a burden on homeowners, appear to have paid off for them, according to a new study. The study, by the New York City Independent Budget Office, offers some limited statistical support for the argument that home values are enhanced by historic-district designation.
The study found that despite the limitations on property rights and the higher cost of meeting historic-designation requirements, the sale prices of one-, two- and three-family homes, per square foot, within historic districts were higher than in nearby neighborhoods in every year studied since 1975. And on average over the entire period, prices of homes in historic districts increased in value slightly faster.
These findings remained even after taking into account differences in house and yard sizes, distances from the subway, age of homes and the relative affluence of neighborhoods. Over all, the study found, the typical house, which sold for $38,000 in 1975, sold in 2002 for $397,000 outside a historic district and $458,000 in one.
While the study did not prove that historic designation caused the increase in values, its findings suggested that at least in the neighborhoods studied, the designation did not make things worse. "It is not likely that property owners are adversely affected" by historic-district designations, the report concluded. They "may actually benefit from being included in a historic district," the report said.
Alan Treffeisen, who wrote the report on the recent study, said that studies around the country have typically found that historic-district designations have had a "small but positive" effect on home resale values. Most of the studies, he noted, have been small and limited. The New York study, in contrast, analyzed 31,093 property sales, including 3,948 in historic districts from 1975 to 2002 in six Brooklyn community boards with historic districts.
"There are individual homeowners who believe they will suffer an economic loss when a historic district is created," said Andrew Berman, executive director of the Greenwich Village Society for Historical Preservation. "This goes a long way to debunking that theory."
But Michael Slattery, a senior vice president at the Real Estate Board, an industry group, said the study had limited relevance to much of the New York real estate market, where properties are often valued by their development potential and designation as a historic district can reduce this potential.
In Fort Greene, Howard Pitsch, who is chairman of the Fort Greene Association and has been restoring a 150-year-old frame house for the last two decades, tirelessly gives tours of the neighborhood, pressing for a major expansion of the historic district to encompass streets that he said are architecturally indistinguishable from many streets inside the current district. Adding to the urgency is the fact that just outside the boundary of the district, an 11-story condo and medical office building, approved under the current zoning, is now rising on a long-vacant corner lot. He said that development could not have been built had the site been within the boundaries of a historic district.