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Property prices are often impacted by amenities in the local area. Casinos are amenities. They are a source of fun for people, and many people love that they can visit them and spend hours and hours just playing. What many people don’t realise, however, is the fact that casinos can have a huge impact on the real estate market. But what is that effect? Let’s take a look.
The answer
Truth be told, people don’t really know how casinos impact the real estate market. However, many people argue that owning property near a land-based casino is a bit of a gamble. In some cases, the price of property will rise thanks to the casino, and in other cases, the price of property will fall. There seems to be no way of predicting which way the real estate market will go.
Some industry analysts predict that the local market can swing by as much as 10% when a casino opens up. Let’s explain the arguments for both sides of the coin.
Why property prices may rise
Real estate experts who believe prices may rise look at the fact that a casino is an amenity. It is a rare amenity too. Not many people will have access to a land-based casino, and people love them. The value of being so close to a land-based casino is huge. It has the potential to push prices up. There are a couple of reasons for this.
Firstly, land-based casinos opening up will often contribute heavily to the nightlife in an area. When a casino opens up, chances are that other businesses that offer decent services won’t be too far behind. Not to mention the fact that the casino will often be located in some of the better parts of a town or city, and thus there will be a lot of value added. The increase in businesses in the area will lead to more things for people to do, and it often means more job opportunities. This means increased property values, in many cases.
A land-based casino that is more of a resort in nature can also mean a lot more people will want to stay in the local area. For this reason, many people will also purchase properties for renting out through places such as Airbnb. This also pushes property prices up.
In very rare cases, particularly when expansion is on the cards (when a property is close to the casino, and we’re talking close), there is a good chance that the value of the land that a property sits on will increase. Although to be honest, most people probably won’t be buying homes like this. Most standard casinos won’t expand, and other businesses won’t want to move in on your turf.
Why property prices may fall
On the other hand, some industry analysts believe that property prices may decline when located close to a casino. This trend can be attributed to several factors.
Firstly, when a casino opens, it often attracts other businesses such as pubs, clubs, and restaurants. Many of these establishments operate late into the night, leading to significant noise pollution in the surrounding area. Historically, areas with high levels of noise pollution see a decrease in property values. This is a common issue around popular land-based casinos. Interestingly, this isn’t a problem with online gambling alternatives. For instance, online casinos for NZ players allow enthusiasts to enjoy gaming without any impact on the local environment, making them a quieter, more community-friendly option.
In some cases, casinos can also lead to increased crime in an area. Well, not directly. It is just that drinking establishments tend to appear around casinos. When there are a lot of pubs and clubs in an area, crime often goes up. It will likely be a marginal increase, but crime rates are always going to impact property prices, and if they start to trend up, then property prices will fall quite quickly.
Casinos also have an impact on the type of jobs available in the local area. Working at a casino is often classed as low-skill work (although many would dispute this!), and many of the businesses that will move into the local area as a result of that casino will often be low-skilled jobs too (remember, bars, clubs and restaurants), and this means that the types of jobs available in the area may be different. If there are hardly that many well-paying jobs close by, then the price of properties will fall to suit.
Final thoughts – the impact of casinos on the real estate market
As we said, there is no real way to predict whether property prices will go up or down based on a casino being in the local area. This is one of the few areas where real estate investment speculators are not in agreement. Ask any real estate agent, and they’ll probably give you a different answer from another. So, if you’re planning on buying property near a casino, we hope that you’re buying it for the love of the property rather than as an investment, because there is no guarantee that your investment will pay off in the long run.