Walmart delivers Low Prices…and High Home Prices

/Walmart delivers Low Prices…and High Home Prices

Walmart delivers Low Prices…and High Home Prices

By | 2017-08-18T16:52:52+00:00 July 14th, 2014|Research Insights, Macroeconomics Research|0 Comments
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(Last Updated On: August 18, 2017)

When Walmart Comes to Town: Always Low Housing Prices? Always?


Walmart often faces strong local opposition when trying to build a new store. Opponents often claim that Walmart lowers nearby housing prices. In this study we use over one million housing transactions located near 159 Walmarts that opened between 2000 and 2006 to test if the opening of a Walmart does indeed lower housing prices. Using a difference-in-differences specification, our estimates suggest that a new Walmart store actually increases housing prices by between 2 and 3 percent for houses located within 0.5 miles of the store and by 1 to 2 percent for houses located between 0.5 and 1 mile.

Alpha Highlight:

Walmart is the prime example of how competition and free markets can deliver goods to consumers at prices nobody would have believed possible 20-30 years ago. I personally love Walmart, but Amazon is quickly becoming my retail store of choice (gotta love competition!).

Of course, Walmart has a lot of haters, and probably for good reason in some cases. Common criticisms include the following: They exploit labor, they destroy communities, they strong-arm suppliers, and so forth.

But how does a Wal-Mart affect real estate prices?

As shown below, prices on real estate surrounding a Walmart get a boost.


More home equity loan proceeds to spend on Walmart products!


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About the Author:

After serving as a Captain in the United States Marine Corps, Dr. Gray earned a PhD, and worked as a finance professor at Drexel University. Dr. Gray’s interest in bridging the research gap between academia and industry led him to found Alpha Architect, an asset management that delivers affordable active exposures for tax-sensitive investors. Dr. Gray has published four books and a number of academic articles. Wes is a regular contributor to multiple industry outlets, to include the following: Wall Street Journal, Forbes,, and the CFA Institute. Dr. Gray earned an MBA and a PhD in finance from the University of Chicago and graduated magna cum laude with a BS from The Wharton School of the University of Pennsylvania.