You’ve all heard the qualitative stories about how artists and creatives move into a neighborhood and the property values start rising (then unfortunately, get priced out). However, we finally have quantitative evidence, as you can see by the chart above.
The hard proof comes as a result of a study released just this month by no other than Richard Florida, along with Charlotta Mellander, called There Goes the Neighborhood: How and Why Bohemians, Artists and Gays Effect Regional Housing Values (the above graph is included in the study on page 25.) With such documented results in hand, artists/creatives have a much stronger foundation to secure support when investing in undervalued neighborhoods, as well as protection from being forced to leave by overbidding once they establish greater value for the neighborhood.
Income, wages, technology, and human capital were factored out in order to determine the direct correlation between openness/creativity/diversity and housing value. Thus, the aforementioned research team developed a new model for determining housing values:
Regional Income + Regional Amenity Premium (artistic and cultural amenities) + Regional Openness Premium (tolerance and open culture) = Regional Housing Values.