Report: Trader Joe’s Tops Whole Foods for Higher Home Values
It’s no secret: people love themselves some Trader Joe’s and Whole Foods. Almost any time a new mixed-use development is proposed in Philadelphia with enough retail space that could possibly fit a grocery store, residents come out of the woodwork to clamor for a Trader Joe’s or a Whole Foods.
You know what those people also love? Money. It’s called “Whole Foods Effect” – a real estate phenomenon where property values seemingly rise in areas surrounding the Austin-based organic grocery chain. The presence of a Whole Foods, especially in urban neighborhoods, seems to certify that a home buyer has made a quality choice of settling in that area.
Well, it turns out that it could probably be called the “Trader Joe’s Effect.” RealtyTrac recently ran some of the numbers and came to an interesting conclusion: “What we found is that homeowners near a Trader Joe’s have experienced better home value appreciation since their purchase, but also pay higher property taxes on average.”
RealtyTrac reports that the average appreciation for all zip codes nationwide is 34 percent, but homes in zips with a Trader Joe’s have seen appreciation slightly above 40 percent. Whole Foods, on the other hand, matches the national average in home appreciation at 34%.
It’s not all peaches and cream for homeowners in the Trader Joe’s camp. The report shows they pay much more in property taxes ($8,536) compared to their counterparts at Whole Foods ($5,382).
Here’s how they came up with the info:
For this analysis we looked at home values and property taxes for 1.7 million homes, condos and co-ops in 188 zip codes with at least one Whole Foods store (and no Trader Joe’s stores) and 2.3 million homes, condos and co-ops in 242 zip codes with at least one Trader Joe’s store (and no Whole Foods stores). We compared the average of current home values to the average of home values at the time the home was last purchased.
Even more interesting is that the supposed “Whole Foods Effect” may not hold a lot of water (asparagus water?) around these parts, or anywhere. Patricia Madej of the Philadelphia Business Journal reports that the national numbers are slightly out of whack on the Main Line, for example, and that even a rep from RealtyTrac is slightly more than skeptical. “The finding, RealtyTrac’s Daren Bloomquist, said involves too many variables and factors to determine if correlation equals causation.”
So, it looks like Trader’s Joes takes this round over Whole Foods. As for us, we’re still clamoring for a Wegman’s to come into the city.
- Better to own a home near Trader Joe’s or Whole Foods? [Philadelphia Business Journal]
Better to own near Trader Joe’s or Whole Foods? [RealtyTrac]
- Whole Foods is coming? Time to buy [Salon]