A 2019 study by ATTOM Data Solutions found that homes within a one-mile radius of a Costco sold for a median price of $604,000, compared to $363,000 for homes farther away — a gap of more than 40%. That headline got a lot of traction. But here’s what people missed: correlation isn’t causation. Costco doesn’t make neighborhoods expensive. Expensive neighborhoods attract Costco.

The real question for Arizona buyers and sellers is whether proximity to one of these big-box anchors actually moves the needle on home values in our specific market — or whether we’re just seeing a retailer that’s good at picking winning locations.

Why the “Costco Effect” Gets Overstated Nationally

The mechanics behind the Costco premium are worth understanding before you apply them to any individual market.

Costco’s real estate team is notoriously methodical. They study household income, population density, traffic counts, and long-term demographic trends before committing to a site. So by definition, when they plant a flag somewhere, they’ve already identified an area with above-average earning power and growth trajectory. Home values in those corridors were likely already trending up.

There’s also a halo effect from what Costco brings with it: a Costco almost always anchors a larger retail development. Think of the grocery stores, restaurants, service businesses, and medical offices that tend to cluster nearby. That broader commercial investment is what lifts surrounding residential values — not the warehouse store itself.

Still, the effect is real in certain contexts. Research from the University of Washington found that homes within a half-mile of a Costco appreciated roughly 1% more per year than comparable homes farther away, specifically in suburban growth markets where new retail infrastructure was being built out. That’s meaningful compounded over a 5- to 7-year hold.

How This Plays Out Across the Phoenix Metro

Phoenix is a fascinating case study for this question because we have Costco locations spread across dramatically different submarkets — and they don’t all behave the same way.

Take the Costco on East Camelback in Scottsdale. That location sits in a corridor where homes were already selling in the $700,000–$1.2 million range before the store existed. The retail infrastructure there is so dense and established that one more anchor tenant barely registers in home pricing. Buyers in the Arcadia adjacent zip codes aren’t choosing their neighborhood because of warehouse access.

Compare that to the Costco cluster around the Loop 303 corridor in Surprise and Goodyear. Out here, we’re watching entire master-planned communities come online in real time. The Northwest Valley has seen some of the most significant home price appreciation in the metro over the past four years, with median prices in Surprise jumping roughly 35–40% since early 2020 based on recent market data. The retail anchors in those corridors — Costco included — are part of the story. They signal to buyers that the suburban infrastructure is mature enough to support daily life without a long commute to shop.

The same dynamic applies to the Southeast Valley around Queen Creek and San Tan Valley. When a Costco opens in a fast-growing exurb, it’s a market signal: this area has crossed the density threshold where major retailers are confident enough to invest. That psychological trigger matters to buyers who are deciding between a truly remote location and one that’s “almost there.”

The Factors That Actually Determine Whether Proximity Helps or Hurts

Not every home near a Costco benefits equally. A few variables determine how much of the retail halo you capture:

  1. Distance matters more than most people think. Homes within a quarter mile often see traffic noise, light pollution, and congestion that offsets any value benefit. The sweet spot in most suburban markets is roughly 0.5 to 2 miles — close enough to walk on a cooler day (which in Phoenix means October through April), far enough to avoid the parking lot chaos on a Saturday afternoon.

  2. The direction of growth. If Costco anchors the edge of an expanding development pattern, homes between the store and the next wave of growth tend to appreciate faster than homes on the other side.

  3. Competing retail density. In established, amenity-rich neighborhoods like Tempe or Chandler’s Price Corridor, one more retail anchor adds little marginal value. The effect is strongest where retail was previously sparse.

  4. School district overlap. In Arizona, this is often the dominant pricing factor in suburban corridors. A Costco in a Chandler Unified or Scottsdale Unified district boundary doesn’t need to do any extra lifting — the schools are already doing the work. But in a newer district still building its reputation, the surrounding retail maturity is a stronger signal to relocating buyers.

What Sellers and Buyers Should Actually Do With This Information

If you’re a seller in Surprise, Goodyear, Queen Creek, or another high-growth corridor: don’t underestimate the “lifestyle infrastructure” pitch. Buyers relocating from California or the Midwest ask about grocery access almost immediately. Being within a short drive of a Costco, a Trader Joe’s, or a major HEB-style anchor is a legitimate selling point for that demographic. It’s worth mentioning in your listing copy and reinforcing in showings.

If you’re a buyer: don’t pay a premium just because a Costco is nearby. The premium only holds if the surrounding growth trend supports it. A Costco that opened five years ago in a neighborhood that’s now fully built out has already been priced in. You’re not getting ahead of anything.

Investors should think differently. If you’re tracking new commercial development coming into Phoenix’s outer suburbs, a Costco announcement in an underserved growth corridor is worth watching as a leading indicator of where residential demand is heading — not a guarantee, but a signal worth including in your due diligence.

The Bottom Line

The Costco effect is real, but it’s a proxy signal, not a direct cause. What it tells you is that someone with very deep pockets and very rigorous site selection criteria believes that neighborhood is worth betting on. In Phoenix’s fast-growing outer suburbs, that vote of confidence matters. In established neighborhoods that already have everything, it adds little.

Before you buy or sell near any major retail anchor, map out the growth trajectory of the surrounding area, check how long the retail has been there, and think about who your eventual buyer or tenant is going to be. The Phoenix housing market in 2025 has been competitive enough that buyers are looking for any edge — but real estate fundamentals still win over retail adjacency every time.

If you’re trying to figure out where a specific property stands in all of this, reach out directly. I can pull the comps, check the commercial activity in that corridor, and give you a real read on whether that nearby Costco is an asset or just a place to buy a four-pound tub of mixed nuts.