Each new Starbucks boosts the value of housing prices in a neighborhood. And not by an insignificant amount.
This data point is revealed in a broader study on gentrification by the Harvard Business School that relied on information from Yelp, the online restaurant review platform, and the United States Census.
A new Starbucks introduced into a ZIP code is associated with a 0.5 percent increase in housing prices within a year, the paper found.
It's not clear whether housing prices are rising due to the Starbucks opening itself or simply because more affluent customers that would go to the coffee chain have moved into the area.
Harvard economics professor Edward Glaeser said Yelp data reveals it may be the latter. The study found that each 10-unit increase in the number of reviews is associated with a 1.4 percent increase in housing prices in the ZIP code.
"The most natural hypothesis to us is that restaurants respond to exogenous changes in neighborhood composition, not that restaurant availability is driving neighborhood change," the paper concludes.
This is the broader point of the paper, which surmises that gentrification is "strongly associated" with increases in the numbers of grocery stores, cafes, restaurants and bars.