More on Heritage Preservation

Originally posted 10/14/06 on PersonPlaceorThing.blogspot.com

Here is a short essay I wrote for my University of British Columbia Foundations of Real Estate Appraisal course last semester about Heritage Preservation and property values (it's brief and was part of a larger assignment):

The city of Saint John has heritage preservation controls, enacted in The Preservation Areas By-Law of the City of Saint John. The by-law requires that a certificate be obtained to alter properties in a designated heritage area, or to build on properties in this area with new improvements. The by-law is meant to preserve buildings of historical significance, while maintaining property value in the area (City of Saint John, 2005).

Within the community there is some disagreement on whether the by-law helps or hinders property value. In an open letter to city council, developer Paul Tobias explains that the by-law has made a project to develop an empty lot in the heritage area infeasible, as the rules do not allow for new apartment buildings to be of sizes to ensure adequate profit. This developer argues that the slow pace of new construction in the area is because a property’s utility is reduced by the by-law (Tobias, 2004). This is supported by Appraisal of Real Estate Second Canadian Addition’s ascertain that such historic ordinances “may be so restrictive that they preclude development (Dybvig et. al., 2005b). Similarly, a recent newspaper article about a renovation project just outside of the heritage area features a redeveloper who explained that he would not have bought a heritage property because of the additional cost in renovation (MacLean, 2006). Alternately, heritage property owners often praise the by-law for protecting their improved property values. The positive impact on improved values can be seen in the fact that real estate agents often indicate that properties are in the preservation area on their sales listings – hoping this will attract buyers.