7 Signs a Neighborhood is Improving
When shopping for a home to buy, some things can be immediate turnoffs: Barred windows, graffiti in the neighborhood, plenty of fast-food restaurants within walking distance, and broken streetlights.
Those are things you probably want to avoid as a home buyer. But there are some things that show a neighborhood is worth investing in as a homeowner. Positives can be difficult to spot in a bad or middling area of town, but sometimes they're visible with a little work.
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.
Here are seven signs to look for when house hunting that a neighborhood is improving:
1 - Low crime
This is an obvious thing to look at as a potential buyer, but it's something you might not see by just look at the outside of houses. 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.
2 - Rebuilding
If property owners or investors are rebuilding homes, inside and out, and older areas of cities are being improved, it can be a sign of revitalization, says Lynn Windle, a real estate marking specialist for the Windle Group at Coldwell Banker Apex in north Texas.
"People are not just cleaning up their yards, but they're rebuilding their neighborhoods from the ground up," Windle says.
To help clients find improving neighborhoods, she has driven around looking for Dumpsters, contractors doing work and other signs of home rehabs.
Rebuilding includes infrastructure improvements by local governments, such as investing in new sidewalks, streetlights, trees and other things.
3 - Improved transit
Walkability is important in a neighborhood, but so it good transit. A city that's adding transit to link neighborhoods and reduce dependence on cars could help raise home prices in those areas.
The Atlanta Beltline, for example, is a planned 33-mile loop of cycling, walking and jogging trails alongside 22 miles of light-rail tracks circling the city. It will ultimately connect 45 neighborhoods.
4 - Nearby jobs
A neighborhood close to a major employer, such as an airport or hospital, can be home to those employees. If a major business announces plans to build near an improving neighborhood, look for home prices there to start rising. If the surrounding area also has other sources of jobs, such as hotels and manufacturing, they could be steady employers that help area residents be able to afford homes.
5 - Hardware stores, unique businesses opening
Hardware stores can be the first sign that an area is improving because it feeds into the rebuilding that homeowners are doing. Every neighborhood needs a hardware store, and seeing one open near a neighborhood you're considering is a good sign.
Non-chain restaurants are also a good sign. A kitchy restaurant or art gallery opening and staying for a year or more can show that businesses are ready to open in areas where people have disposable income, Windle says.
Even something as basic as a Starbucks opening can result in higher appreciation of homes around it, says Bruce Alion, a real estate agent at RE/MAX Town and Country in Atlanta.
"Where I work with investors, economically distressed areas have no coffee shops and spotty wireless service," Alion says.
He also suggests checking for vacant retail stores in the area, and sitting outside the local grocery store and noting the age and condition of cars. "The newer and cleaner the cars, the more healthy the economics of the community," Alion says.
6 - Artists moving in
If you follow the artists - they're either moving to certain neighborhoods or the area caters to them with studios and rental space to do their work - it can be a sign of revitalization. If the weekly newspaper lists an area as the best neighborhood for artists, it's worth checking out.
In addition to promoting creativity, these neighborhoods may attract artists because they're walkable, have independent businesses, and have a lot of public art.
7 - Projected rising home prices
A one-year forecast of a home's price can show desirability of a property, along with inventory and how long the home has been on the market.
One way to do this is through Weiss Residential Research, which shows buyers the real estate market value history in the area they're looking at, along with a one-year forecast of the property. 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.
Perhaps the best way to know if a neighborhood is improving is to go with your gut instinct and not overlook the obvious. I once had a real estate agent show me a house that was great on the inside and had more than enough room for my family, including a huge backyard.
Just beyond the back fence, if you stood on the top step before going into the yard, you could see the tops of trailer homes. A trailer park, we figured, wasn't a sign of an up-and-coming area.