2005/06/15 Council Agenda Packet

Table 14 The Effect of Commercial Businesses on Residential Property Values in Austin, Texas 115 The survey also asked respondents to indicate the effect on residential property values if the site was used for something other than an adult bookstore. As indicated in Table 14, the majority felt that property values would. be higher if the site were used as a medical office or branch library. They indicated that residential property values would be reduced if the site was used as a pool hall, tavern, welfare office, drug rehabilitation center, or another type of adult entertainment business. Causes of Property Value Decline. The real estate professionals were asked to describe the effect of adult businesses on property values in general and the basis for their opinions. These questions are important because they help establish why property values are affected by adult businesses. The respondents based their opinions on several factors. They noted that the type of clientele attracted by adult businesses create concerns among families with children. Several noted that residential Properties in close proximity to adult business sites are no longer suitable as homes for families with children. This eliminates a large portion of the market, lowering demand, which in turn decreases the ittarket value of the property. It was also noted that the existence of adult business facilities leads mortgage underwriters to believe that the general neighborhood is in decline. Therefore, they would be less willing to make 90 to 951 financing available for these properties. E V ER00297 finch higher Somewhat higher About The Same Somewhat Lower Much Cower ('hitch 21 161 581 241 -- I',xjl liall — 21 391 451 141 Welfare Office — 41 361 451 151 Neighborhood Tavern — 91 381 341 211 Record Store — 261 611 111 21 Medical Office 181 361 411 61 — Branch Library 21% 403 331 61 — Dcug Rehabilitation — 21 22.1 481 281 Ice Cream Parlor 6.1 421 46t 61 — video Game Parlor — 161 533 311 — Mult Video Arcade -- 41 271 281 421 Topless Bar — 191 231 581 massage Parlor — — 191 231 581 Adult Theater — — 231 211 561 The survey also asked respondents to indicate the effect on residential property values if the site was used for something other than an adult bookstore. As indicated in Table 14, the majority felt that property values would. be higher if the site were used as a medical office or branch library. They indicated that residential property values would be reduced if the site was used as a pool hall, tavern, welfare office, drug rehabilitation center, or another type of adult entertainment business. Causes of Property Value Decline. The real estate professionals were asked to describe the effect of adult businesses on property values in general and the basis for their opinions. These questions are important because they help establish why property values are affected by adult businesses. The respondents based their opinions on several factors. They noted that the type of clientele attracted by adult businesses create concerns among families with children. Several noted that residential Properties in close proximity to adult business sites are no longer suitable as homes for families with children. This eliminates a large portion of the market, lowering demand, which in turn decreases the ittarket value of the property. It was also noted that the existence of adult business facilities leads mortgage underwriters to believe that the general neighborhood is in decline. Therefore, they would be less willing to make 90 to 951 financing available for these properties. E V ER00297