Starbucks Makes Sales

Published on March 20th, 2015

Having a Starbucks nearby may help to increase your home’s value

The American Dream: a nice home in a quiet neighborhood, a white picket fence that runs along your manicured lawn, a swing in the back for your kids, and a Starbucks Coffee around the corner. While the Starbucks bit may be a new addition to this iconic image of the American Dream, this international franchise has proven that it’s here to stay. And even if their Frappuccinos and Eggnog Lattes often cost more than a quick meal – if there’s one around the corner from your house, those daily visits could offer a return on your early morning investments.

Are they fueling or are they finding?

According to the book, Zillow Talk: The New Rules of Real Estate, homes that were located near a Starbucks saw a “venti-sized” appreciation in price of 96 percent between 1997 and 2014. Homeowners who weren’t lucky enough to have this mocha haven nearby, only saw a 65 percent increase in value during this time period. This reflects a pretty disparaging gap between the coffee haves and the sleepy, coffee have-nots. But, what is spurring this? Does Starbucks know what neighborhoods are going to see gains and quickly establish themselves to draw in a more affluent audience or is their presence enough to increase home prices? While there is speculation on both sides of this question, one thing is clear: Starbucks are often found in more gentrified, lucrative neighborhoods. Also, as an international icon of coffee, there’s good reason to believe that a lot of data and research goes into where they’re going to raise their next green and white flag. So whether or not their presence increases home values or they know where the boom is going to strike, the numbers are still clear: Starbucks not only makes coffee, they also make sales.

Cause or effect?

The authors of Zillow Talk don’t mince words when discussing whether or not a nearby Starbucks is just the result of home prices increasing in the neighborhood or whether Starbucks actually causes the increase. According to them, Starbucks is the cause, not the effect. They also discuss the effects on how close you live to a Starbucks - the closer, the better. Because, who doesn’t love the idea of walking out your door to the nearby café and having your coffee made for you every day?

So, for those who are shopping for a home as the spring mortgage market frenzy kicks into full gear… Our best advice? Go fuel up with a latte and then walk, don’t run (or spill) to the nearest listing.

If you’re shopping for a home or thinking it may be time to buy, it’s best to start with speaking to a qualified mortgage professional. Feel free to reach out to our Housing Buzz Specialists today.

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