Real estate

How to sell a home near railroad tracks

John and Lenore live in a lovely, well-maintained and furnished home. They recently listed the it for sale.

After multiple showings, in a very hot sellers’ market, the home still didn’t have an offer.

Feedback from buyers’ agents give us an indication of why buyers were hesitant to make an offer. Although they “loved the house,” most of the agents said, the nearby railroad tracks were a turnoff.

Lenore was flabbergasted. Yes, there are Union Pacific freight tracks nearby, but they are located far enough away that in 6 years of living in the home she’d only heard a train once.

Did any trains actually go by during these showings? No. In fact, it’s a little-used line.

Surveys say

Most of the research we’ve read shows that the homes that suffer the largest decrease in value are located quite close to the tracks.

A study out of Norway finds that the further away from the tracks the home is located, the less of an impact they have on its value.

“… our estimates indicate that a doubling of the distance from the railroad line, within a 100- meter bound [about 328 feet], increased the property price by about 10%.”

A report by Appraisal Journal (more details later) shows that smaller homes are impacted more than larger homes.

They found that the average loss in value was “… 5 percent to 7 percent) for homes 1,250 square feet or less located within 750 feet of railroad tracks. Larger homes, however, showed mixed results.”

Freight line operators who want to increase their level of traffic spurred a study by the City of Rochester, Minnesota. Results suggest that for each 1 decibel increase in noise, there would be a corresponding 0.4% loss in value for properties adjacent to the tracks.

What do appraisers say?

Since the appraiser has the last word on the value of a home, we decided to find out what their approach is in a situation such as John’s and Lenore’s.

In 2004, Appraisal Journal published the results of a study out of Ohio. For a three-year period, the researchers tracked the value of residential properties near freight railroad tracks in Cuyahoga County.

“The findings indicate an average loss in value between $3,800 and $5,800 (5%-7%) for houses under 1,250 square feet located within 750 feet from a railroad track,” the authors state. “Larger houses showed mixed results.”

Alison Shuman, at TheAppraisalIQ.com, claims that each situation is different. “Specific information about a given home would need to come from an appraisal of the home in question,” she suggests.

What can an agent do to help?

There really is nothing you can do to help a home that is in close proximity to railroad tracks except to soundproof it or price it appropriately.

Yes, it’s going to take some convincing of homeowners who have grown accustomed to the sound of trains that their home is worth less than they think.

If the tracks are further away:

  • As Lenore quickly deduced, an actual train schedule showing how infrequently the trains used the tracks in her area, left on the kitchen counter, would be an amazing way to help potential homebuyers relax. The only problem is that freight train companies don’t keep a schedule like commuter train lines do. Alas, she was unable to get such a document. Instead, she gathered anecdotal evidence from her neighbors who, like her, either rarely or never hear a train pass by.
  • Work with the homeowner to find out how far the tracks are located from the home and add it to the list of anecdotal evidence. Leave it in an area that potential buyers can’t help but see it. In John’s and Lenore’s case, although they are visible from the home, they are located across a huge parcel of vacant land (roughly equivalent to two or three city blocks away) and buffered by a wash directly across the street from the home.
  • Enter the home’s address into the U.S. Department of Transportation’s National Noise Map. Share it with potential buyers if the results are good.

Selling a location-challenged property tests even the most patient real estate agent. Warn your clients that it may take longer to sell the home and they may have to drop the price.

That, and the aforementioned information is pretty much all you can do.

Are your real estate marketing ideas evading you at the moment? Here is a list of 200 real estate marketing ideas to get you more leads this month.

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