Finding a great deal on a home in an undesirable neighborhood may have you thinking that you scored big – for a moment. Once you are ready to rent out the property, you may find that there is very little interest. And, even more discouraging, those who do show interest are likely to be less-than-desirable, opting for anything.
As an investor, it is important that you fill your portfolio with rental properties that stem from neighborhoods with value. You want to have tenants want to live in your property. But, how? What determines the value of a neighborhood?
Truth be told, there are a lot of things that go into neighborhood valuation. For now, however, we are going to focus on the most common variables.
Access to Jobs. While many people are willing to commute long distances for their jobs if it means their family can live in a nice neighborhood, having a short and convenient commute is a huge bonus. Neighborhoods that are within a short driving distance to metro areas or large employers are definitely of interest.
Highly Rated Schools. Did you know that even if a neighborhood seems to be going downhill, having access to good schools can keep the value up? People want their kids to have a good education – and they are even willing to move to get it.
Future Development. Is there a lot of vacant land areas nearby? Is future construction inevitable? When determining the valuation of a neighborhood, you have to take into consideration the future development that may come to the area.
Low Crimes Rates. Families, couples, and even single individuals want safety. It’s a universal desire that can be found in good neighborhoods. And, it is a huge factor when it comes to determining the value of the area.
Parks and Well-Kept Community Areas. Everyone loves to get outdoors from time to time. And, having a local park or other well-kept community areas in which you can do this adds worth. Besides, seeing the greenery and families enjoying the outdoors instills a bit of emotion or nostalgia in us.
Pride in the Neighborhood. Take a look around as you drive through the neighborhood. Are houses cared for? How about the lawn and landscaping? Does it appear that residents take a bit of pride in their homes here? Those who care about their community and show it often reside in areas that have a higher value.
Investing in real estate intended as future rentals means knowing what your future tenants will want. The more desirable the neighborhood, the more desirable the property. And, the greater the response from desirable tenants. What a win!
