Housing Prices Near El Toro Reported Stable

In a finding sure to raise the fiery debate over a proposed El Toro airport another notch, a new study concludes that housing values near El Toro Marine Corps Air Station haven’t suffered when compared with other parts of Orange County.

The Anaheim information services firm Experian found house and condominium prices within a 6.5-mile radius of the site appreciated 0.7% over a 13-month period through February, while values elsewhere in the county rose 1.1%. The gap was not statistically significant, the study concluded.

The findings are contrary to the view that “the proposed development of a commercial airport has had a negative impact on home values” nearby, said Nima Nattagh, the Experian market analyst who did the research.

Nattagh said he was well aware that his study would be controversial. But he stressed that he had no ties to groups backing the airport plan and said he undertook the research independently and with no “preconceived notions.”

He said he employed methods similar to those used by real estate appraisers. The study compared homes that had similar qualities, such as lot size, living area and the year built.

“This is objective research,” Nattagh said, and it stands apart from the “rather subjective” statements he’s seen so far regarding the impact of the proposed El Toro plan on the housing market.

Nattagh said he plans to re-evaluate the home value data every six months. “It’s still early,” he noted. “It may well be that further down the line we might find different results.”

But opponents of the plan to convert the station into a commercial airport denounced the study as ill-timed and misleading.

“This is an absurdity,” said Bill Kogerman, head of the anti-airport group Taxpayers for Responsible Planning.

Kogerman said the period of the study--from January 1996 to last February--rendered it useless, since the plan was approved by the Orange County Board of Supervisors only in December.

He also latched onto the study’s finding that home prices within a 2.9-mile radius declined 2.2%. Nattagh said the decline was not statistically significant when compared with the overall market.

Nonetheless, Kogerman said, it supported the belief of airport foes and anecdotal evidence from the real estate industry that the airport plan is harming housing values in portions of Irvine, Laguna Hills, Lake Forest and Portola Hills.

The Experian study “is of no value to anybody who is contemplating the sale or purchase of a home,” Kogerman said.

The current airport plan, a scaled-back version of the one originally envisioned, calls for the military station to be converted to a commercial airport capable of handling between 10 million and 25 million passengers a year.

Opponents have challenged the environmental impact report for the plan, arguing that the analysis of possible benefits and negative impact of an airport is flawed. Some have offered an alternative plan to turn the property into a sports and entertainment complex.

In February, some airport foes unearthed a 1994 federal study to support their view that property values would plunge if the current reuse plan goes through.

The Federal Aviation Administration report found that property values were lower in neighborhoods hard hit by noise from airports in Los Angeles, New York and Baltimore. But the agency said the results couldn’t be used to make general conclusions because only a few areas were studied, and the impact of noise varies greatly.

Bing Girling, a Newport Beach real estate agent and vice president of the Airport Working Group, which supports the El Toro airport plan, said the Experian study lends credence to arguments that house prices generally don’t fall because of an airport’s presence.

Property values surrounding John Wayne Airport “have gone up and up and up,” Girling said. And that airport doesn’t have a large no-development “buffer zone” similar to El Toro, he noted.

If property values are declining in a specific area, it’s probably a result of other economic factors, he said. “That’s just the nature of the real estate business. I don’t think it has anything to do with the airport.”

Michael Meyer, managing partner of E&Y; Kenneth Leventhal Real Estate Group in Newport Beach, said that some neighborhoods could be hurt because of traffic and noise generated by an airport, although the damage could be minimized by good planning. Overall, though, area housing values could benefit “from a phenomenal increase in shopping and job opportunities close to home.”

Gary Watts, who tracks the local housing market, said that opponents and proponents of the airport plan are both missing the point.

The airport proposal has affected the local property market, said Watts, who owns Impact Real Estate in Mission Viejo. His statistics show, for example, that houses closer to the Marine station in Lake Forest have been staying on the market longer than homes in other areas.

But that’s only because of the uncertainty over the future of the area, he said. Once a final decision is made about the airport, he expects that normal economic forces will take over. Residential values should increase because the demand for housing is strong and the supply is limited, he said.

“People just want to know what in the heck is going to be there, and they’ll deal with it,” Watts said.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Airport Impact

Residential property nearest the proposed El Toro airport depreciated between January 1996 and February 1997. Home values farther from the site rose slightly. However, the changes were not considered significant when compared with the rest of Orange County.

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Change in Homes Miles from El Toro home value surveyed Less than 2.9 -2.20% 73 3 to 3.9 0.40% 114 4 to 4.9 0.50% 93 5 to 5.9 2.60% 107 6 to 6.5 1.50% 100 0 to 6.5, inclusive 0.70% 487 Comparable homes throughout Orange County 1.10% 544

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Source: Experian