Housing Prices - Chagrin Falls vs. CH / SH (Cleveland, Euclid: HOA, insurance)

[SlideRules99]

Hi,
I’m doing the internet house search thing, getting the lay of the land ahead of a spring relocation. (That’s me on the “charming Main Street” post down the page).

I’ve noticed Chagrin Falls homes pricing at least double vs. comparable homes/neighborhoods in Cleveland Hts and Shaker Hts. CF price per sq ft > $200 in the village, most often more. CH homes in leafy Cedar/Lee area generally $100 per sq ft, often less.

Case in point. (I hope these links work).

Chagrin Falls ($575K):

https://www.realtor.com/realestatean...hares_core_ldp

Cleveland Hts ($275K):

https://www.realtor.com/realestatean...hares_core_ldp

Obviously there won’t be complete apples to apples comparison on these homes, but I’m illustrating the broader trend.

Supply and Demand...I get it. But seriously, such a big discrepancy between local markets? Insights?

Thanks!

[Cleverfield]

Chagrin Falls is demographically much wealthier per capita, and has a much higher rated school system. For wealthy people Chagrin Falls is one of the most “choice” locations in the area. Cleveland Heights can be a city of choice too but it tends to attract a more niche set of people (liberal, values diversity, enjoys being close to the city). In my experience far more wealthy people want the Chagrin Falls lifestyle (homogenous, bucolic, quaint small town, more conservative) than the Cleveland Heights/Shaker Heights lifestyle.

[WRnative]

IMO, as explained in your earlier thread, the neighborhoods of CH nearest University Circle are immense bargains for empty nesters compared to Chagrain Falls. A possible exception would be for those who demand convenient and almost immediate access to great natural areas, such as the South Chagrin Reservation of the Cleveland Metroparks.

It's possible that some persons who gravitate to CF are not much interested in diversity and cherish the more elite status of CF, and they are sufficiently wealthy that housing value, and proximity to world class cultural institutions, and mass transit access, are not important.

As mentioned by Cleverfield, the CF school system is one of the best in Ohio. The CH system by contrast is facing significant problems, which soon may be remedied to some degree by public school reform legislation now emerging in the Ohio legislature. If the legislation becomes law, eliminating the drain of private schools on the CH school budget, CH may be an even better bargain for those buying now.

https://www.usnews.com/education/bes...-school-15375#

Persons definitely pay more for housing to get the best possible, but affordable in the family budget, schooling for children.

Don't forget also that CH borders on East Cleveland, the most distressed community in Greater Cleveland. The good news is that East Cleveland may be at its nadir and may undergo gentrification (much like New York City's Harlem or perhaps more apropos Morningside Heights, given East Cleveland's border with University Circle) in the decades ahead, especially if finally annexed by Cleveland.

https://macaulay.cuny.edu/seminars/h...ification.html

[SlideRules99]

Thanks you both - excellent insights. I’m probably an anomaly in that both locations appeal to me, owing to the unique strengths of each area. We’ll need to weigh out the pros/cons, and both of you have helped tremendously on both discussion threads.

We have similar dichotomy in Portland (Lake Oswego vs. Laurelhurst/ Irvington), but the price deltas are not nearly as significant. Hence my surprise.

Thanks again.

[dr_j_planning]

Originally Posted by SlideRules99

Hi,
I’m doing the internet house search thing, getting the lay of the land ahead of a spring relocation. (That’s me on the “charming Main Street” post down the page).

I’ve noticed Chagrin Falls homes pricing at least double vs. comparable homes/neighborhoods in Cleveland Hts and Shaker Hts. CF price per sq ft > $200 in the village, most often more. CH homes in leafy Cedar/Lee area generally $100 per sq ft, often less.

Case in point. (I hope these links work).

Chagrin Falls ($575K):

https://www.realtor.com/realestatean...hares_core_ldp

Cleveland Hts ($275K):

https://www.realtor.com/realestatean...hares_core_ldp

Obviously there won’t be complete apples to apples comparison on these homes, but I’m illustrating the broader trend.

Supply and Demand...I get it. But seriously, such a big discrepancy between local markets? Insights?

Thanks!

SR99, I caution how you employ the word "comparable." When you consider a home, you consider the neighborhood and broader community of that home as well. As others have suggested in previous posts, Chagrin Falls and the Heights are not comparable communities at all. The Heights are inner-ring, street-car suburbs of Cleveland. They offer older urban architecture, proximity to job hubs, diversity, progressive politics, mixed-use walkability and public transit. The Heights are quite large and offer a broad spectrum of neighborhoods and schools. Cleveland Heights and University Heights share a school district, but Shaker Heights has a separate school district. There are neighborhoods that range from those struggling with disinvestment and blight near the East Cleveland border to expansive, multi-acre estates in the Shaker Lakes area.

In contrast, Chagrin Falls offers a more bucolic, small Western Reserve town atmosphere. It is racially and socio-economically much more homogeneous, politically conservative, more removed from Greater Cleveland's urban infrastructure (no public transportation, but offers a very walkable, mixed-use downtown). The Chagrin Falls school district is much whiter and smaller than either Cleveland Heights-University Heights or Shaker Heights. While housing stock in the immediate vicinity of the downtown is quite historic and typically on smaller lots, you will find newer housing on larger acreage parcels in areas just outside of downtown.

Please visit the Cuyahoga County Fiscal Officer's website to check details for any house that piques your interest (e.g. year built, living area square footage, lot size, current and historic tax information, historic price information, current and historic ownership information, etc.): https://myplace.cuyahogacounty.us/.

Welcome to Northeast Ohio!

DR J

[dr_j_planning]

https://www.cleveland.com/realestate...-recovery.html

[WRnative]

Originally Posted by SlideRules99

Thanks you both - excellent insights. I’m probably an anomaly in that both locations appeal to me, owing to the unique strengths of each area. We’ll need to weigh out the pros/cons, and both of you have helped tremendously on both discussion threads.

We have similar dichotomy in Portland (Lake Oswego vs. Laurelhurst/ Irvington), but the price deltas are not nearly as significant. Hence my surprise.

Thanks again.

There's also an economic factor that isn't as obvious. Between Shaker Heights and Cleveland Heights, there are a very large number of pre-WWII homes, many with significantly greater than average square footage. These homes may be more expensive to maintain. So it's logical to assume that the demand for these homes is rather limited in relation to the large supply, especially when disparities in school systems and tax rates are considered.

Also, persons likely are not willing to pay as much for perhaps unneeded, marginal square footage as they are for "necessary" square footage. With the work from home trend taking hold, perhaps with demand for two home offices, perhaps more square footage is considered necessary for some families, raising the attraction of the larger homes in CH and SH.

My hunch is that the average home in CF is smaller, and newer, than the larger, older homes in great supply in SH and CH, many built with living accommodations for servants.

In coming years, especially if Greater Cleveland becomes a destination during the anticipated Great Climate Change, demand may rapidly catch up with supply in SH and CH, offering significant appreciation potential as so many of the homes in CH and SH sell well below replacement cost. Again, my hunch is that the market value/replacement cost ratio in CF is much tighter, and possibly the average market value exceeds replacement cost. Perhaps replacement cost is a factor to research by contacting the realtor for listings and asking for replacement cost information. Many owners know the replacement cost number as it impacts their home insurance decisions. Let's us know what you find out if you make this inquiry. You can't just use average building construction estimates as the quality of construction in SH and CH is often much better than the average today, if ignoring aged foundations.

Speaking of foundations, if you factored in the cost of replacing foundations in CH and SH, the difference in cost/square foot likely would be much less. Of course, the homes in CF also often are 4-6 decades old, if not more. I also suspect that drainage and water tables may be more problematic in CF. I've never checked flood maps in CF, but I knew owners who lived next to a stream and worried about flood risk.

SH, with a better school district than CH, has seen 10.7 percent home appreciation over the last year, compared to 8.2 percent in CH, where both the average housing stock and the school system are less desirable than in SH.

https://www.zillow.com/shaker-heights-oh/home-values/

https://www.zillow.com/cleveland-hei...h/home-values/

The average home value appreciation YOY has been only 3.2 percent in CF, perhaps suggesting that the trend suggested above already is taking hold. It's also possible that more persons in the market can afford only less expensive homes. E.g., Euclid, OH, also with a steep income tax rate and less desirable schools, has seen a 10 percent YOY appreciation in home values.

https://www.zillow.com/euclid-oh/home-values/

Just thinking out loud.

[ferraris]

Originally Posted by SlideRules99

Supply and Demand...I get it. But seriously, such a big discrepancy between local markets? Insights

There is a supply difference for sure. CF's core residential walkable area is comparably small.

Other factors are perceptions about prestige, schools, crime, and the future trajectory of each city.

CH also has higher property and income tax.

[SlideRules99]

OK, good / helpful points, everyone. Generally we’re focused on pre-WW2 stock, so yeah, CF definitely has fewer such homes than the many blocks of CH and SH offerings...and CF village proper is where the concentration lies as you all know. And these are comparatively spendy.

I’m trying to set aside my west coast perspective here, because I know it probably doesn’t apply to this market. But I look around CH /SH and I think one of 2 things: 1) these gorgeous homes are way underpriced and eventually they’ll get snapped up, with lucky buyers riding the appreciation as greater CLE enjoys resurgence, gentrification, etc (per WRnative’s point), or 2) the locals know something I don’t, or have a hunch (per Ferraris perception factors), and current bargain pricing reflects some type of bearish sentiment.

To be clear, my highest priority is not investor ROI...it’s maximizing livability and quality of life. But appreciating assets are always welcome

Dr.J, point taken, thanks for the insights and link.

And yes, I’ll research replacement cost as well.

[theurbansuburban]

As mentioned above, property taxes are a major influence in the area.
Garfield heights, Cleveland Heights, Shaker Heights, South Euclid, University Heights have the highest property taxes in Northeast Ohio, and some of the highest in the state per $100,000 value.

Also, CH inspects private property like a HOA each year and will nail property owners on "infractions".

Also in the last 2 years, properties were reappraised for most Northeast Ohio communities, so the drastic fluctuation in property taxes is a contributing factor to the current available housing stock as some people don't want to double how much they pay in property taxes each year.