A new ATTOM Data analysis found that prospective homebuyers are better off buying near a Trader Joe’s than a Whole Foods or an ALDI.
Two things have changed, however. First, homes near Whole Foods have seen stronger home price appreciation recently – an increase closer to those seen with a nearby Trader Joe’s. ATTOM analysts think that might have something to do with Amazon’s acquisition of the high-end grocery chain.
Second, real estate investors who want to maximize their return via flipping or renting should target neighborhoods closer to ALDI, the discount German-owned grocer ALDI, according to the analysis.
Homeowners near a Trader Joe’s have an average 5-year home price appreciation of 67 percent, compared to 52 percent for homeowners near a Whole Foods and 51 percent near ALDI. Average appreciation for all zip codes with these three 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); homeowners near Whole Foods had an average 31 percent equity ($187,925) and homeowners near ALDI had an 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 (return on investment) 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.
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.