SEATTLE, July 3, 2018 /PRNewswire/ -- Buyers are willing
to spend more for the comforts of a cooler home. A new Zillow®
analysisi finds that homes with air conditioning sold
for 2.5 percent more than homes without it, which is a premium of
nearly $5,500 for the typical U.S.
home.
The premium for air conditioning is highest in San Antonio, where homes with air conditioning
sold for a 5.8 percent premium. Cincinnati is close behind, with a 5.7 percent
premium for homes with air conditioning. Homes with air
conditioning also sold for a five percent premium in Detroit, Indianapolis and Las
Vegas.
Buyers put a higher value on air conditioning than outdoor home
features like a patio or deck. Air conditioning was listed as a
required feature by 62 percent of buyers, while a private outdoor
space was deemed essential by 48 percent of buyers, according to
the 2017 Zillow Group Consumer Housing Trends
Reportii.
Unusually hot summer days have become more common over the past
few decades, according to the Environmental Protection
Agencyiii, which may help explain why air conditioning
is becoming more of a necessity in many markets. Across the
country, 66.1 percent of homes that sold in the past year have air
conditioning. In markets with some of the hottest climates, air
conditioning was in nearly every single home that sold in the past
year. It was in 99.1 percent of homes sold in Las Vegas, and 97.9 percent of homes sold in
Phoenix.
"With summer temperatures hitting record highs across the
country, today's home buyer places a premium on the
once-upon-a-time luxury amenity of air conditioning," said Zillow
Senior Economist Aaron Terrazas.
"Individual design preferences or decorating styles might deter
buyers from certain homes, but there is a strong consensus in favor
of air conditioning, although in the nation's fastest-moving
markets, AC may weigh relatively low for buyers eager to find any
home they can. In historically more temperate climates, some homes
– especially older ones – aren't as likely to have air
conditioning. But in places where temperatures regularly reach
triple digits, it's hard to find a home without air
conditioning."
Renters put a slightly higher premium on air conditioning. The
typical U.S. rental on Zillow in the last year with central air
conditioning rented for 2.8 percent more than rentals in the same
market that don't have air conditioning, or about $40 per month.
This may be because renters are more limited than homeowners
when it comes to adding air conditioning. They likely can't install
a central air or HVAC system for example, and window units may not
be as effective at cooling an entire home.
The New York, Las Vegas and Phoenix metros – all markets with sweltering
summers – had the highest rent premiums for air conditioning. While
central air conditioning is prevalent throughout Las Vegas and Phoenix, it is fairly rare in the New York metro, which includes northern
New Jersey and Long Island. Just
17.2 percent of New York metro
rental listings advertise air conditioning, compared with 54.7
percent of on-market rentals overall.
|
For-Sale
Listings
|
Rental
Listings
|
Metropolitan
Area
|
Share Of
Homes Sold
With AC
|
Dollar
Premium
|
AC For-Sale
Premium
|
Share Of
Homes For
Rent With
AC
|
Dollar
Premium
|
AC Rent
Premium
|
United
States
|
66.1%
|
$5,486
|
2.5%
|
54.7%
|
$40
|
2.8%
|
New
York/Northern
New Jersey
|
22.6%
|
$8,798
|
2.1%
|
17.2%
|
$275
|
11.6%
|
Los Angeles-Long
Beach-Anaheim,
CA
|
51.8%
|
$251
|
0.0%
|
42.5%
|
$135
|
4.9%
|
Chicago,
IL
|
61.5%
|
$2,666
|
1.2%
|
32.7%
|
$54
|
3.3%
|
Dallas-Fort Worth,
TX
|
89.5%
|
$2,982
|
1.3%
|
87.0%
|
$38
|
2.4%
|
Philadelphia,
PA
|
54.2%
|
$10,566
|
4.6%
|
45.6%
|
$43
|
2.7%
|
Houston,
TX
|
96.7%
|
$9,072
|
4.6%
|
94.4%
|
$117
|
7.6%
|
Washington,
DC
|
83.2%
|
$6,807
|
1.7%
|
74.0%
|
$15
|
0.7%
|
Miami-Fort
Lauderdale, FL
|
56.5%
|
$10,208
|
3.8%
|
34.8%
|
$64
|
3.4%
|
Atlanta,
GA
|
84.0%
|
$2,519
|
1.2%
|
79.7%
|
$10
|
0.7%
|
Boston, MA
|
45.4%
|
$6,461
|
1.4%
|
23.8%
|
$171
|
7.2%
|
San Francisco,
CA
|
33.7%
|
$6,925
|
0.7%
|
27.0%
|
$46
|
1.4%
|
Detroit,
MI
|
63.2%
|
$8,470
|
5.5%
|
46.1%
|
$28
|
2.4%
|
Riverside,
CA
|
87.8%
|
$9,271
|
2.6%
|
87.4%
|
$133
|
7.0%
|
Phoenix,
AZ
|
97.9%
|
$4,314
|
1.7%
|
94.5%
|
$141
|
10.3%
|
Seattle,
WA
|
8.4%
|
-$5,622
|
-1.1%
|
6.8%
|
-$66
|
-3.0%
|
Minneapolis-St Paul,
MN
|
81.5%
|
$1,297
|
0.5%
|
64.8%
|
$53
|
3.2%
|
San Diego,
CA
|
10.8%
|
$4,084
|
0.7%
|
12.1%
|
-$5
|
-0.2%
|
St. Louis,
MO
|
81.3%
|
$695
|
0.4%
|
81.4%
|
$17
|
1.5%
|
Tampa, FL
|
84.3%
|
$2,279
|
1.1%
|
81.2%
|
$5
|
0.4%
|
Baltimore,
MD
|
74.6%
|
$12,055
|
4.6%
|
61.4%
|
$11
|
0.6%
|
Denver, CO
|
45.2%
|
$531
|
0.1%
|
40.3%
|
$26
|
1.3%
|
Pittsburgh,
PA
|
58.5%
|
$3,260
|
2.3%
|
42.0%
|
$43
|
4.0%
|
Portland,
OR
|
32.6%
|
$6,464
|
1.7%
|
27.9%
|
$58
|
3.2%
|
Charlotte,
NC
|
83.1%
|
$4,932
|
2.5%
|
87.2%
|
$46
|
3.6%
|
Sacramento,
CA
|
81.1%
|
$4,490
|
1.1%
|
75.4%
|
$119
|
6.4%
|
San Antonio,
TX
|
89.6%
|
$10,757
|
5.8%
|
87.2%
|
$108
|
8.1%
|
Orlando,
FL
|
96.3%
|
$5,361
|
2.4%
|
93.9%
|
$84
|
5.8%
|
Cincinnati,
OH
|
77.4%
|
$9,092
|
5.7%
|
63.9%
|
$29
|
2.3%
|
Cleveland,
OH
|
67.4%
|
$6,182
|
4.4%
|
46.9%
|
$64
|
5.6%
|
Kansas City,
MO
|
75.8%
|
$5,530
|
3.1%
|
60.2%
|
$13
|
1.0%
|
Las Vegas,
NV
|
99.1%
|
$13,620
|
5.2%
|
98.1%
|
$135
|
10.4%
|
Columbus,
OH
|
91.1%
|
$5,447
|
3.0%
|
74.0%
|
$10
|
0.8%
|
Indianapolis,
IN
|
93.6%
|
$8,180
|
5.4%
|
76.9%
|
$66
|
5.5%
|
San Jose,
CA
|
28.8%
|
-$2,084
|
-0.2%
|
32.3%
|
$76
|
2.2%
|
Austin, TX
|
92.5%
|
$8,074
|
2.7%
|
75.4%
|
$108
|
6.4%
|
Zillow
Zillow is the leading real estate and rental marketplace
dedicated to empowering consumers with data, inspiration and
knowledge around the place they call home, and connecting them with
great real estate professionals. In addition, Zillow operates an
industry-leading economics and analytics bureau led by Zillow
Group's Chief Economist Dr. Svenja
Gudell. Dr. Gudell and her team of economists and data
analysts produce extensive housing data and research covering more
than 450 markets at Zillow Real Estate Research. Zillow also
sponsors the quarterly Zillow Home Price Expectations Survey, which
asks more than 100 leading economists, real estate experts and
investment and market strategists to predict the path of the Zillow
Home Value Index over the next five years. Launched in 2006, Zillow
is owned and operated by Zillow Group, Inc. (NASDAQ:Z and ZG), and
headquartered in Seattle.
Zillow is a registered trademark of Zillow, Inc.
|
|
|
i This analysis looked at homes with
and without central air conditioning that were sold or listed for
rent between June 1, 2017 and May 31, 2018 in the 35 largest metro
areas. It controlled for variables that can affect the value of a
home, including the number of bedrooms and bathrooms, square
footage, age of the home and its location.
|
ii https://www.zillow.com/report/2017/buyers/wants-needs/
|
iii https://www.epa.gov/climate-indicators/climate-change-indicators-high-and-low-temperatures
|
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SOURCE Zillow