A new ATTOM Data Solutions analysis shows that prospective homebuyers are better off buying near a Trader Joe’s than a Whole Foods or an ALDI — although homes near Whole Foods have seen home price appreciation more closely on par with those near Trader Joe’s over the past year possibly thanks to the Amazon acquisition of the high-end grocery chain.
But for real estate investors looking for the best home flipping or rental returns, targeting neighborhoods around the discount German-owned grocer ALDI is the best strategy, according to the analysis.
Here are the details:
- Homeowners near a Trader Joe’s have seen an average 5-year home price appreciation of 67 percent, compared to 52 percent appreciation for homeowners near a Whole Foods and 51 percent near an ALDI.
- Average appreciation for all zip codes with these grocery stores nationwide is 54 percent.
- Homeowners near a Trader Joe’s also have added equity, owning an average 36 percent equity in their homes ($232,439), while homeowners near Whole Foods had an average of 31 percent equity ($187,925) and homeowners near ALDI had average 18 percent equity ($46,352).
- The average equity for all zip codes with these grocery stores nationwide is 24 percent.
- Flip the tables and properties near an ALDI are an investor’s golden goose with an average gross flipping ROI of 69 percent, compared to properties near a Whole Foods which had an average gross flipping ROI of 41 percent and Trader Joe’s at 36 percent.
- The average gross flipping ROI for all zip codes with these grocery stores nationwide is 57 percent.
- Not to mention properties near an ALDI had an average gross rental yield of 10 percent, compared to properties near a Whole Foods with an average gross rental yield of 6 percent and Trader Joe’s at 5 percent.
- The average flipping ROI for all zip codes with these grocery stores nationwide is 8 percent.
For this analysis ATTOM Data Solutions looked at current average home values, 5-year home price appreciation from YTD 2017 vs. YTD 2012, current average home equity, home seller profits and rental data from U.S. Department of Housing and Urban Development on zip codes nationwide with a least one Whole Foods store, one Trader Joe’s store and one ALDI store. Grocery store locations are from the USDA (http://www.fns.usda.gov/snap/retailerlocator).