From the National Community Stabilization Trust:
A recent academic paper “Do Property Rehabs Affect Neighboring Property Prices?” shows that when National Community Stabilization Trust community partners rehabilitate distressed properties, this activity strengthens neighborhoods by boosting the values of neighboring properties. Authored by Rohan Ganduri and Gonzalo Maturana, who are Assistant and Associate Professors of Finance respectively at Emory University’s Goizueta Business School, the study uses NCST’s unique property-level dataset on property rehabilitation and other data sources to study the effects of property rehabs.
The authors find that house prices surrounding a rehabilitated property increase between 2.3 and 4.0 percentage points following the rehabilitation, a sizeable spillover effect. The authors also estimate that the average rehabilitation generates an aggregate home value gain for neighboring residents that is 3.8 times greater than the amount invested, or over $130,000 for the median rehabilitation amount of about $35,000.