Most Jacksonville residents understand they have to pay more to live along the water than in other parts of the region.
But according to a study released last week by real estate data firm Zillow, Jacksonville residents are paying a higher premium for waterfront living than people in any other U.S. market.
Looking at more than two decades of data, Zillow determined Jacksonville homebuyers pay a 72 percent premium for waterfront property.
The only other city close to Jacksonville is Cleveland, where the premium is 68 percent. The next highest premium after that is in Denver, at 52 percent.
A waterfront home is defined as a home along a lake, river or ocean where the homeowner can reach the water without leaving his or her property.
“Buyers are willing to pay extra for features that add a unique benefit to a home, and being right on the water’s edge is one of them,” Zillow Senior Economist Aaron Terrazas said in a news release.
“These homes are relatively rare, making up only a small portion of the housing market, and that scarcity keeps prices high,” he said.
Zillow said waterfront homes make up only 0.27 percent of homes in the Jacksonville market, so even though water is abundant in the area, real estate is scarce.
Nationally, the percentage of waterfront homes is higher than Jacksonville but remains low at 0.47 percent.
The market with the highest percentage of waterfront homes is Miami, at 5.86 percent, and buyers there pay a 38 percent premium.
Jacksonville generally is a more affordable housing market than other cities, and Zillow said the markets with the highest waterfront premiums tend to have lower overall home prices.
The median value of a waterfront home in Jacksonville is $633,700, Zillow said, above the national median value of $426,300.
The premium for waterfront homes throughout the country since 1996 is 41 percent, it said.
However, the premium in the first quarter this year was 36 percent, the lowest level since the second quarter of 2002.
Zillow said a reason for that is non-waterfront homes have recovered in price from the housing crash a decade ago, but waterfront property has not fully recovered.
While the gap may have narrowed, Terrazas expects homebuyers to continue paying a premium for waterfront living.
“Having waterfront access is incredibly appealing for many buyers, and even as environmental risk factors like rising sea levels and storm surges gain more attention and make some buyers more cautious in the homes they consider, the premium for waterfront homes is likely to endure,” he said.
