Islanders worry that tolling will bring down property values. The belief is that having to pay each time you go off-Island will make living on the Island less attractive. While it is too early to tell what the long-term effect on Island property values will be, it might be instructive to see how property values have faired in other communities affected by tolling.
The only such communities even close to Mercer Island would be Hunts Point and Medina. Presumably, their home values would have fallen after tolling was put in place on SR-520 in December, 2011. No, they are not like Islanders in that they can reach key services by simply heading into downtown Bellevue, or by ‘going around’ the lake to get to Seattle. But, we would argue that for many west Bellevue residents, a trip around the lake would hardly be a viable or practical option.
What has happened to home values there? Property values in those communities have remained stable and have even increased. A year after tolling began, assessed property values in the Medina and Hunts Point communities remained flat in 2012, then increased slightly for 2013. Why is that — a fluke, a statistical error? Home buyers there don’t care about tolls because they are so rich? Hmmm, we have heard that before.
Here on Mercer Island — as SR-520 commuters avoiding SR-520 tolls flooded onto I-90, the Park and Ride and buses, property values fell by 4.4 percent last year. Yet some of that loss has been made up when assessed property values for 2013 increased by 1.4 percent.
It is folly to assign a change to a single variable. And the possibility of tolling I-90 (authorized by the Legislature in 2009) was not well known until recently. There are many possible factors affecting property values here. Time is an important factor.
Yet when asked about the impact of tolling on home values here, Lloyd Hara, the current King County assessor, was a bit puzzled to learn there was a concern. He was not convinced there would be any long-term effect. “A bump, maybe,” he said.
“Only time will tell if potential tolling of I-90 would have an impact, if any, on property values on Mercer Island,” he said. “It would be up to prospective homeowners to make that cost-and-benefit analysis in the real estate market.”