Yesterday, Google released details of the new Google Fiber internet and tv service which will be offered to select locations in Kansas City, Kan. and Kansas City, Mo. As part of their announcement presentation yesterday, Google makes the bold assertion that having a direct fiber optic connection to your home will increase its value. In fact, they suggest that the value may rise as much as $2,000-$5000, and compare it to such improvements as installing new windows or remodeling a kitchen.
CORRELATION TO REAL ESTATE:
Assuming that there will be an extended period of time in which these are the only homes with lightning fast internet and tv connection in the nation, these homes should enjoy a competitive edge in the real estate market and may even lead to increased values in select neighborhoods. Think about it – if a buyer is trying to choose between Prairie Village and Brookside, the difference could be Google Fiber. If a buyer is trying to choose between a home in Hyde Park with Google Fiber or a home in Waldo without Google Fiber, which do you think he will choose? Over time, a trend will develop which will lead to an increase in values.
I can’t believe it, but I do agree with Google’s projections with two caveats. First, I do not think the increase in values will be seen immediately, I believe this will be something that develops over time as demand increases and certain neighborhoods become more desirable. My second caveat is that this increase in value will only last during this period of exclusivity. What do you think?