One of the most important things when buying a home is understanding the importance of a good neighborhood. People have been able to achieve this in multiple ways, but one area that is often overlooked is location. No, not the actually city you live in, but what is in your neighborhood. I get it, it does not take a researcher to tell me that a house near a strip club is going to go down in value. But some things might surprise you with the the data actually says about home value.
Realtor.com posted an article with this info graphic below.
Let’s look at some of the items in the info-graphic.
When it comes to living near quality medical facilities, we all want that. But we don’t want to be so close it starts being a problem. The closer you are to these, the more often you will hear constant ambulances. If you live near Loma Linda University Medical Center, you will sometimes hear the helicopter landing. Either way, buyers are willing to drive if it means avoiding the extra traffic it can bring.
The article pointed out something really interesting.
In one extreme case, the crime-plagued neighborhood of Washington Park in East St. Louis, IL—the ZIP code 62204—has 10 strip clubs. 10! How do they all compete? It saw only a handful of homes sold in the past three years, with a median price of $10,000.
Being in real estate, the first thing that jumped out to me was homes being sold for a median price of $10,000! Being based in Southern California, these are numbers we do not see that often. I would not want to be the agent trying to sell a home in that neighborhood.
The numbers in this article say that a bad school is going to cause the most decrease in home value. But I actually don’t think its that simple. Real estate is extremely complex and every home buyer weighs and makes different choices.
Schools are very important to real estate, that is without question. Even if you do not plan to have kids, living near a quality school will continue to bring value to your neighborhood. You could make the argument that a poor school is what eventually drove down the home prices. In extreme circumstances, a top level school will bring in top quality residents and even wealthy foreign home buyers into a neighborhood. Living across the street from the school is not smart for home value, you just need to be in the schools district.
This one is interesting because it shows the impact of death and superstition in real estate. I personally would pick living close to a cemetery over a power plant or shooting range, but according the data on the article, the cemetery has more of an impact.
Of course, do not assume these are the only things that seem to be bringing down the value of your house. Did you paint the exterior of your home pink? Have you neglected cleaning the wood floors of the house? The point I am trying to make is, there is lots of small details that will add up when someone is looking at your home. Things can sound extremely pointless, but buyers are spending lots of money to buy a home, they are going to notice light fixtures, bathroom tile, and much more.
Be aware of all the factors that can hurt you, not just the obvious ones.