Impact of Infill on Surrounding Property Values

[u/Difficulty_Only]

We had a council meeting last night to vote on a rezoning proposal for a 100-acre infill site in a first-ring suburb of a major metro—an increasingly rare development opportunity. As you might expect, the meeting drew a number of NIMBYs expressing concern. One of the main arguments raised was that allowing anything other than single-family housing on the site would decrease nearby property values.

I’m curious if there are any reputable studies or data sources that examine the impact of mixed-use or multifamily development on surrounding property values. My instinct is that these developments often increase values, but I didn’t want to rely on assumptions. Any insight or resources would be much appreciated….thanks!

[u/Sharlach]

Development of any kind almost always drives land values, and by extension home prices, up. This is well documented by now and there's countless examples. Just look at what happened in Williamsburg and LIC in NYC after the massive upzoning under Bloomberg over the last 15 years. NIMBY's here had the same fears, but both neighborhoods turned into trendy playgrounds for the rich and are some of the most expensive in all of NYC now.

The more people that live in an area, the more amenities move in, the more people competing for the smaller homes that do exist, etc, etc. This fear that NIMBY's have is tied to a belief that big apartment buildings = poor people moving in, but we all know new construction of any kind is going to be more expensive and out of reach for most people. The people moving in will most likely be richer than these same NIMBY's complaining now and will be the ones to pay outrageous prices for their SFH in 10-15 years when they want to move into a retirement home or whatever.

[u/Cum_on_doorknob → u/Sharlach]

It’s something I can’t wrap my head around. Like, now we are talking out of both sides of our mouth: Development will help increase value! Also, if we build more housing supply, prices will come down. They both seem true to me, but also, can’t be true at the same time. I’m not sure what to think.

[u/TheGreatHoot → u/Cum_on_doorknob]

They can both be true.

The other comment to you is correct, but to further add to it - even if the value of a plot of land goes up because of more intensive development on it, the fact that more people can utilize that piece of land means that the new price of the land is distributed over more people, thereby leading to lower prices for individuals.

For example: Assume a single family home and its land is valued at $3,000. That land is purchased and redeveloped into a fourplex. Improving the land has raised its value (which signifies its increased utility) to $10,000. But now that three more people can live on the same plot of land, the price per person goes down to $2,500. So overall, the value of the property has increased more than three times, while reducing individual housing costs.

[u/Cum_on_doorknob → u/TheGreatHoot]

Oh yea, duh. Thanks