Celebrity Neighbors: Experts Weigh In On How It Affects Property Values
When you think of ways to improve property values in the neighborhood, you might think of cleaning up the yard or building a new roof. But for some sellers, having A-list celebrities as neighbors might be what it takes to add interest to the listing, while also increasing home values. Whether they're living in loft apartments in Manhattan or in palatial Hollywood mansions, in general, celebrity neighbors can be an asset and help improve home values in the area.
How does star power work with improving real estate values? In a word, buzz.
"Celebrities can add cachet to a neighborhood when they move in," says Rick Kelly, senior vice president of Prudential Douglas Elliman Real Estate in New York City. Kelly has worked with several celebrities in the past including musicians and television stars. "Successful people have the money to move and live pretty much wherever they want, so they can add buzz to certain neighborhoods just by moving in." That buzz can translate into increased interest in the neighborhood, especially if the area isn't known for having famous residents.
"People tend to think 'if this area is good enough for a celebrity to move to, then maybe I should move here,'" says Carolyn Cole, a realtor with Nourmand & Associates in Hollywood, California.
When a celebrity moves in, expect to see some home improvement. Cole said that celebrities will buy a home in a desirable neighborhood, then renovate it to their specifications. "Numerous celebrities, like Jennifer Aniston and Gwen Stefani, buy and then remodel a home to their particular style," Cole comments. "Celebrities spend time and money remodeling because the home they want in a certain location might not exist yet," she continues. The improvements, which can range from updating the kitchen to completely tearing down an existing home and building a new one in its place, can result in increased property values for other homes in the neighborhood.
Home improvements can also extend to security. "Some celebrities have extremely sophisticated security systems and privacy features in their home," according to Cole. These enhancements can also increase the home's resale value, making it an attractive feature for buyers looking for a security system that is already installed.
When selling a house, it sometimes helps to mention if any famous neighbors live nearby. "In New York, a lot of what's being sold is basically the same four walls," Kelly says. "If you can say that a famous person lives in the same building as the unit for sale, then that information can attract interest in the area." However, Kelly says that he's seen potential buyers get caught up in the idea of living near a celebrity. "People sometimes get starstruck and then they don't really focus on the house for sale," he comments.
Having a celebrity move into the area isn't always a good thing. While a celebrity resident might not detract from home values in the area, they might make life a little more difficult for neighbors.
"The paparazzi following a certain celebrity might bother others in the neighborhood," Cole says. Certain celebrities also have admirers and, in some situations, stalkers, creating a stressful situation for everyone in the neighborhood. In addition, former homes of famous celebrities might be stops on bus tours, creating disruptions in the neighborhood. While a bus tour might not detract from a home's value, it might be considered a nuisance to potential buyers.
Kelly agrees, stating that he researches a prospective home for a buyer to see if any celebrities live nearby. "In New York, everyone's on top of each other, so you want to know if paparazzi will be near the home and trying to take pictures of a celebrity," he says. Researching other units in a building also cuts down on potential run-ins between high-profile celebrities. Kelly once showed an apartment to a politically active celebrity whose potential neighbor was on the other end of the political spectrum. The celebrity Kelly represented ended up taking an apartment in another building.
While having a celebrity living on the block can be an asset in many communities, some areas won't see much of an impact from another celebrity moving in. "Certain areas, like Beverly Hills, are already saturated with celebrities," Cole says, "It would take a huge pop icon like Tom Cruise to increase the status of an area."
Megan Horst-Hatch is a mother, runner, baker, gardener, knitter, and other words that end in "-er." She loves nothing more than a great cupcake, and writes at I'm a Trader Joe's Fan. Her work can be found at Examiner.com.
