How To Understand the Value Jump Between Nearby Streets: Ask a Wahi REALTOR®

When experts say real estate is all about location, location, location they don’t just mean the neighbourhood. Home values can differ greatly from street to street. Here’s why.

By Josh Sherman | 2 minute read

Have you ever wondered why the prices of apparently similar homes can seem so different from one street to another?

In our latest edition of the ongoing Ask a Wahi REALTOR® series, we help home buyers understand these kinds of value jumps between nearby streets. Some of the price differentials can be explained by concrete property traits, but others are decidedly less tangible.

Here are five things that can result in hyper-local price differences in home prices. 

1. The quality, type, and style of homes

Sometimes, homes on one street share specific characteristics compared to another nearby thoroughfare. These differences could even arise on the same street, with one side having higher-quality finishes, larger lots, or any number of other upgrades.

“In relatively new suburbs, homes on one side of a major street might be newer and have more in demand finishes than on the other side, leading to more demand — and higher prices,” says Alkok.

This could also apply to the types of homes. You may come across a stretch of row or townhomes, which are generally more affordable, on a street otherwise populated with pricier detached houses.

For condos, prices can fluctuate from building to building — even within the same development. Possible explanations: different condo management or rules (a building that allows short-term rentals potentially exposes residents to increased disturbances), build quality, floor plans, or amenities.

2. The immediate surrounding environment 

Similar to how the many unique characteristics of a home can influence its value, the attributes within the immediate vicinity of a property can as well. For instance, direct waterfront exposure or access can give home values a boost. Research also suggests that there’s a positive correlation between cycling lanes and property values, particularly in urban cores. And the presence of a sidewalk is estimated to increase a home’s value by $700 to $3,000, according to Chatham County.

Two parallel residential side streets could have different price points because one backs onto a noisy highway, transit hub, or commercial centre while the other lets onto a public park, wooded ravine, or golf course. Of course, green space isn’t necessarily a boon for home prices all the time; research from realtor.com® in the U.S. suggests homes near cemeteries may be worth 12% less than other similar properties. 

3. School zones 

For homebuyers with young children, living in the catchment area of a top-rated school is a common priority. While prices vary — in the Greater Toronto Area, the median price of a home in a top-rated school zone ranges from $570,000 up to $3,200,000, depending on the neighbourhood — these areas typically command a premium, all else equal.

Note that school zones, or catchment areas, don’t always match neighbourhood boundaries. Homebuyers may encounter two nearby streets, each within an entirely different catchment area. Also be aware that living in a catchment area doesn’t guarantee enrolment. Schools may be at capacity or facing other limits. 

4. Bylaws and borders

Other scenarios that could result in a value jump between homes on nearby streets involve zoning or other jurisdictional borders: for instance, if a border between two municipalities stands between two homes. Here are some possible implications for home values:

• Zoning: One municipality or have looser zoning rules that allow for greater density in some low-rise neighbourhoods. Depending on the property, this could increase values as it unlocks redevelopment potential. The same municipality sometimes has different zoning for different areas, which has the potential to lead to a value jump between nearby streets.
• Heritage: In addition to broader zoning rules, think specifically of heritage districts or designations, which limit what kinds of renovations and improvements one can make to a home to preserve the area’s existing character.
  
  A 2023 study from McMaster University, in Hamilton, suggests that such designations, though limiting, actually push home prices higher. “The nine studies in our literature review arrived at the consensus that heritage designations positively impact the sale price of residential properties,” notes the study’s executive study.
• Property taxes: These also impact home values (lower taxes reduce ownership costs and can be a positive for values) and may differ between two bordering municipalities resulting in different home values on neighbouring streets. In Ontario, Wahi research suggests that annual property taxes on an average home across the province’s 30 biggest cities range from $3,334, in Windsor, up to $5,658, in Markham.

5. Prestige 

Some addresses carry more cachet with homebuyers than others. Take the Bridle Path, in Toronto. This particular residential street is known as Millionaires’ Row — and for good reason. From the late artist formerly known as prince to 6ix God Drake, celebrities have long chosen to reside within the exclusive enclave.

Prestige is difficult to put a price on, and there are several other contributors to the street’s sky-high home prices — not least of all including sprawling lots and the presence of massive custom homes, some of which boast 10,000 square feet or more of living space. But some homebuyers likely see value in being able to say they live on the Bridle Path or pointing out to guests that used to be Prince’s house over there.