As any new resident to our region can attest, apartments within walking distance of a Metro station charge a premium in monthly rent, one that renters appear willing to pay.
And no wonder, according to a recent report, Washingtonians suffered through the worst traffic congestion in the nation in 2010, losing an average of 74 hours a year sitting in traffic, costing an average of nearly $1,500 a person.
These high transportation costs make many apartment renters more than willing to pay higher rent to be able to walk to a Metro station and avoid the frequently gridlocked highways on their daily commutes.
To calculate how much more, we analyzed two sets of apartments from a sample of the region’s apartment property inventory. One group included those located within one-half mile of a Metro station, and a second included those located farther than one-half mile from a station. According to this analysis, Washingtonians have consistently paid more in rent to live within walking distance of a Metro stop, even throughout the recent downturn.
Of course, countless other factors affect apartment rents, the age and quality of the property, safety of the neighborhood and proximity to employment and retail nodes, to name just a few. But this clearly shows that transit-oriented development remains in strong demand in D.C.
Zooming in a little closer to the submarket level, the trend still holds true. In the District, apartments within walking distance of Metro command 28 percent more in rent than those farther from transit stations. In the Northern Virginia, Inner Beltway and Montgomery County submarkets, the premiums are even higher, both near 40 percent in the third quarter of 2011.
While Prince George’s County offered the most affordable Metro-walkable apartments in the region, rents there are still 11 percent higher than those for properties located farther from Metro stations in the same submarket.
No individual submarket has a premium as high as the metrowide average because submarkets with no Metro stations (Loudoun County, outlying Maryland counties and outlying Virginia counties) have rents on the lower end of the spectrum, pulling down the non-Metro-walkable aggregate at the metro level.
While the apartment rent premium in Fairfax County is the smallest at about 9 percent, the county currently only has two Metro stations, in Vienna and Dunn Loring.
When the first phase of the Silver Line increases Metro service in the county in 2013 or 2014, apartments located near the new stations should command above-average rents based on the trends in other submarkets.
Stephanie Hession is a senior real estate economist with CoStar Group in Washington.