It can be tough getting around Western New York without a car. For the most part, Buffalo is a driving city, and people tend to park their cars where they live – in driveways, and in garages. But that’s not always the case. In tighter urban areas like the cities of Buffalo, Lockport, Lackawanna, and Niagara Falls, there are a number of houses without driveways, hence the demand for on-street parking.
Conventional wisdom tells us that a house without a driveway will sell for less than a house with a driveway. People buying ‘drivewayless’ houses typically have a “will this affect resale value?” conversation with their realtors. Sellers of such properties worry that a lack of a driveway will have a negative effect on the appraisal. But how does the active house-buying population feel? Is there a discount to buying a house without a driveway? This question has been nagging me for some time now. With my statistical analysis skills atrophied to nonexistence, I decided to hire Ryan Thomas of Cornell University (Department of City and Regional Planning) to find out.
Together, we conducted a Hedonic Regression Analysis of all residential properties sold from August 2019 through February 2021 in Erie County. The regression predicts housing values based on six variables: square feet, taxes, number of bathrooms, age, location inside Buffalo or out, and access to a parking spot. As expected, things like square footage, number of bathrooms, and recent construction added to the value. Higher taxes and location within Buffalo also added to the value, which some people may find surprising.
I went into this study expecting to find a premium paid for a parking spot. The opposite turned out to be true. The model calculated having a driveway negatively affects your property value. Anyone with any sense would not agree with this statement. Is the model measuring something else?
We found this study to be accurate when running the numbers a variety of ways, adding different factors into the model. Changing things like omitting lot square footage and unit count, and the inside/outside factor was born of this. We could never find a combination of factors where a driveway increased the price. The final product can be viewed here.
What does this mean? The model could be measuring something else. Most of the houses without driveways were multi-unit. These properties tend to have higher value as they are income generating. We tried to control for that but it didn’t work. The most likely thing is that a driveway has no statistical relevance to the price. To measure the value parking has on a house is like measuring the value of paint color. Is this really true?
There were 18,176 sales in the 1.5 year time frame, 237 without parking. There were no single family houses without driveways. These houses were found in all neighborhoods of Buffalo with a heavy concentration in the West Side and few in North Buffalo.
Is there a method to truly determine driveway value? Perhaps a more localized property search could decipher a positive outcome? The West Side would be the ideal location, as that is where the most ‘drivewayless’ houses are concentrated.
There is a single family house without a driveway on the market right now that I am watching. I know of another coming to the market soon. Let’s circle back around once they are sold.