The location of a home dictates many factors that impact not only the value of the property but the number of potential homebuyers that will be interested in your property. Since location is a fixed attribute, you’ll want to make sure you not only have a home with great potential to upgrade but that the neighborhood itself doesn’t need any upgrades.
5 Things to look for in a neighborhood when looking for your next REI project
1. Safety
Some cities in California tend to have higher crime rates than others. You’ll want to make sure to get a good grasp on a prospective neighborhood’s overall safety. It’s the California Attorney General’s duty to collect, analyze and report on crime in the state. The AG’s website is a great resource to access crime statistics tables. https://oag.ca.gov/crime – You’ll want to make sure that while the property may seem like a good deal, crime hasn’t run the previous owners out and potentially be a blocker in selling the property again.
2. Schools
Looking at the school districts/schools that are zoned for your potential real estate investment deal is particularly important to buyers with school-aged children and those who plan to have children, but that’s not the only reason it’s important. Depending on the potential demographics of buyers in the area, this could be a very important factor to some buyers and can have an impact on the overall property value over time. A reputable school district will boost the home’s value. You can do a quick search of Great Schools at https://www.greatschools.org and input the address or zip code to check out the school’s ratings based on test scores, academic progress, and equity. Quality public schools are a great asset to a potential flip project.
3. Homeowner’s Associations
You’ll want to take any Homeowner’s Associations into account as that will affect the monthly costs of the home, in addition to the specific association’s rules and regulations. If there is an HOA, you’ll want to investigate factors such as, how the HOA is regulated, the covenants, conditions, restrictions, and bylaws, any fees or assessments, and check if there have been any lawsuits brought against the association. You want to make sure the HOA will be affordable and not prohibit you or your future buyers from making the necessary renovations and won’t be a blocker to your plans.
4. Proximity to stores, restaurants, schools, parks, and businesses.
Depending on whether the property is in more of a city center or suburban area, you’ll want to check out how close it is to nearby grocery stores, restaurants, schools, parks, shopping, etc. Unless the charm of the property is its remoteness and that is what your potential buyers will be after, most likely they will want to be a short drive or walk to important nearby locations.
You can check out the walk score, transit score, and bike score of the property listing in order to get an understanding of the overall convenience of the location. In more populated dense city areas, a high walk store is a great selling point. A high walk score is defined by being able to do daily errands regularly and not requiring a car. For busy cities where driving is more of a hassle because of little parking and traffic, a great walk score is very marketable. Likewise, a transit score considers how easy and accessible the address is to public transportation, which is also a great asset. This is also important in areas known for people taking public transportation like downtown city centers. Lastly, a bike score could also have an impact on potential buyers. A bike score equally measures on a scale, bike lanes, hills, destinations, road connectivity, and bike commuting mode share. It may not be as impactful as the walk and transportation score, but in areas where cycling is very common, this too could be an additional selling point.
5. Proximity to busy roads, highways, or long-term construction projects
Just as you want to take into consideration the property’s convenient access to stores and the like, conversely, you want to check out the proximity to any potential inconvenient annoyances or dangers. Oftentimes, you can hear a freeway or busy road if it’s located too close. Also, if the property is located near any airports, you should consider the flight path and airport noise. Trains can also be particularly loud and if some tracks have trains that run all night, that could really impact the potential homebuyers and make it less desirable when you resell. If any neighbors or nearby businesses are undergoing any major construction that might be something to keep in mind as well. Although that is a more temporary issue, it could still impact you when it comes time to sell and should be taken into consideration.