HOUSTON – A golf course view is a desirable amenity for many homeowners. According to a new university study, having a property adjacent to a golf course can also boost resale value, putting more money in sellers’ pockets.
Real estate professionals around Houston interviewed by RealtyNewsReport.com broadly agree with the faculty-led study from Florida Atlantic University in Boca Raton, which found that properties next to golf courses typically carry a premium. The FAU research estimates that the average price increase for adjacent properties ranges from roughly 8 to 12 percent.
“Preliminary results from statistical pricing models suggest that properties receive a pricing boost,” said Ken Johnson, Ph.D., a real estate economist and associate dean of graduate programs and professor in FAU’s College of Business. “Thus, there is strong evidence to conclude that golf courses remain a positive draw to potential property owners.”
Local agents emphasized that while a golf course can add value, school quality often remains the most critical factor for many buyers.
Shad Bogany, a Realtor and former chairman of the Houston Association of Realtors (HAR), said the FAU findings align with market experience. “Typically, homes in a golf community are higher-end properties. You don’t see golf courses in entry-level communities,” he noted.
Cindy Hamann, current HAR chair, added that golf is an amenity many are passionate about, especially retirees, and that homes adjacent to a golf course can be just as attractive as those inside a golf community.
Bogany observed that well-maintained courses draw players from a wide area, not just nearby residents, and that course condition can directly affect neighborhood values. He cited a Missouri City course that had deteriorated until the city intervened. After improvements, he said, nearby home prices rose by 10 to 20 percent.
FAU’s study examined more than 10,000 transactions that closed in 2015 in Florida’s three southernmost counties—Miami-Dade, Broward and Palm Beach. The analysis focused specifically on properties adjacent to golf courses and deliberately excluded homes located within gated or managed golf communities that require mandatory membership fees.
“This is a great idea for an extension of the paper,” Johnson said of studying homes inside golf communities, “but needed data is not yet available.” He also noted the study included controls for location, so the model accounts for factors such as affluent neighborhoods.
About 50 miles north of Houston, in Montgomery County, the Woodforest development includes a 27-hole public course. Virgil Yoakum, general manager and vice president of master-planned communities for Johnson Development Corporation, said the golf course makes the area a destination and contributes to the community’s appeal. The facility draws 45,000 to 50,000 rounds of golf a year and features a 10,000-square-foot clubhouse; play is available via membership or daily fees.
“We do not own the golf course, we own the real estate,” Yoakum said. “Having a golf course adds value to the community.”
Not everyone agreed. David Jarvis, senior vice president of John Burns Real Estate Consulting, told reporters he sees no correlation between nearby golf courses and higher home values. He pointed to demographic shifts and declining participation in golf as factors that change the amenity’s appeal.
“It’s interesting,” Jarvis observed. “We have an aging population, yet people don’t want to play golf.” He added that he personally wouldn’t choose a home in a golf course community.
Both Texas and Florida have seen many courses close: the FAU study noted that more than 800 golf courses in the United States shut down in the last decade. Communities, developers and municipalities must decide whether to convert underperforming golf properties into other uses or maintain them as golf venues.
In South Florida, Johnson said financial pressure has left many golf facilities in poor condition, which can harm neighboring property values if decline continues. Conversely, the study suggests that where demand for golf remains and courses are well kept, adjacency can command a premium on property prices.
“Uncertainty over value destroys deals,” Johnson said. “These findings reduce that uncertainty and should result in quicker resolutions one way or another.”
March 8, 2017 Realty News Report Copyright 2017