While it’s a bad idea to judge a book by its cover, when looking for an affordable house, there are some neighborhood trappings you know are bad juju — like barred windows, graffiti in the neighborhood, plenty of fast-food restaurants within walking distance, and broken streetlights.

There are also things that signal a good investment, but unless you look carefully, you might miss it, according to MortgageLoan.com’s Kara Johnson. “Positives can be difficult to spot in a bad or middling area of town, but sometimes they’re visible with a little work,” she says. “If you look carefully – or at least your real estate agent does – you can find signs that a neighborhood is improving and buy property before everyone else wants in and prices rise dramatically.”

The first sign to sleuth for is low crime. That might sound obvious and overly simplistic, but it’s not evident during a drive-by. Johnson suggests, “Either go to the local police department for statistics, or look it up online at a crime-mapping site that shows a less safe area in red and a safer area in green. The ‘yellow’ zones can be more of a bargain if crime rates are dropping.”

Another sign of an up-and-coming area is gentrification. Look for construction zones, homes being rebuilt, inside and out, and older areas of cities that are being improved. Look for dumpsters, contractors doing work, and other signs of home rehabs. Infrastructure improvements by local governments, such as investing in new sidewalks, streetlights, trees, and other things are also great signs. And if there are plans for transit being added to a neighborhood, take that as golden as well. “A city that’s adding transit to link neighborhoods and reduce dependence on cars could help raise home prices in those areas,” says Johnson, who also adds that hiking, biking, and jogging trails along major roads are also a good sign.

You may not even think about it when you pass by a brand new Home Depot or Lowe’s, but hardware stores can be the first sign that an area is improving. They feed into the rebuilding that homeowners are doing. “Non-chain restaurants are also a good sign,” says Johnson. Add to that art galleries, yoga studios or gyms, and clothing retailers, signaling businesses are ready to open in areas where people have disposable income. Starbuck? You’d better know they do exhaustive feasibility studies before they open a new location. On the other hand, no coffee shops, spotty wireless service, vacant stores, and old, junky cars all over the place are not good signs.

Let your fingers do the walking, since a walk through the neighborhood may not tell you all you need to know. Weiss Residential Research shows buyers the real estate market value history in the area they’re looking at, along with a one-year forecast of the property, according to Johnson. “Red indicates properties are declining and green is for appreciating properties. The report is $25 or you can fill out an online form to have someone contact you with the free report.”

And then there is your gut. Johnson tells the story of a house she looked at that was great on the inside and had more than enough room for her family, including a huge back yard. But when gazing beyond the back fence from a higher level, she could see a trailer park. Not a good omen. Visit the local City Hall’s site planning office to check for plans for commercial areas, schools, roads, etc.

Source: MortgageLoan | TBWS

Published on: January 8, 2021