In today’s hypercompetitive housing market, buyers don’t have a lot of leverage. Many prospective buyers, facing rising interest rates and tightened loan requirements, have gotten creative — looking at distressed properties to find a deal, or working with a low-commission real estate agent so they can put a few more dollars into their down payment.
But in your rush to find a home that you can afford, it’s important to look at the neighborhood, too. A home’s neighborhood is arguably as important as the property itself regarding your future satisfaction. And the stakes are high! One recent study found that 70% of recent home buyers had regrets about their purchases.
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So how do you evaluate a neighborhood? Several factors will determine how “at home” you feel in your new home. Let’s look at 22 of the most important ones!
1. An Acceptable Noise Level
The amount of ambient noise can have a huge influence on your quality of life in a new home. Make sure you visit a prospective area at different times, and on different days. If you only go to an open house on a Sunday morning, just be aware that you might have visited during the quietest period of the entire week. There could be a beer garden, commuter train, or music venue down the street that changes the entire character of the neighborhood for the rest of the week.
Just like you wouldn’t sell a house without doing a comparative market analysis, you should never buy a house without checking it out multiple times and days.
2. Shopping Options
It’s not ideal to have to get in your car and drive twenty minutes every time you want a coffee or a gallon of milk. Think about the things that you buy every day, or very often, and check to see if there are nearby places where you can get them. Think grocery stores, pharmacies, department stores, and the like. Are they within a walkable distance? What are their hours? Do you have a wide selection, or will you be forced to go to the same place every time?
Sidewalks might sound like something you can take for granted, but there are a lot of neighborhoods that don’t have any sidewalks, often by design. Neighborhoods without sidewalks often have very low community cohesion and trust and tend to be unsafe for people who do attempt to walk around.
High walkability is also associated with higher home values, and you can’t have walkability without sidewalks. Accessibility is also important if you or your loved ones ever need to get around by wheelchair. Bottom line: good neighborhoods have sidewalks.
4. Emergency Services Close By
Where is the nearest emergency room or fire department? While everyone hopes they won’t need those services, being able to call on them when you need to can literally be life-saving. Especially if you’re older or have a medical condition, it’s important to be able to get to a quality hospital in minutes.
The same applies to the fire department. If you have to wait thirty minutes (or more) for the fire department to get to your house, you don’t have much fire protection.
5. A Short Commute
Shorter commutes are associated with more job satisfaction and a higher quality of life. So when you’re looking at a neighborhood, honestly assess how long it’s going to take you to get to and from work. If you aren’t sure you want to drive, look at mass transit options like light rail or buses. The average commute in the U.S. is around a half hour so be wary about exceeding that too much.
Trees are nice to look at, but they’re also associated with higher levels of life satisfaction. One study found that people who lived in neighborhoods with more trees were less likely to be on antidepressants than people who lived in treeless neighborhoods. While there are a lot of factors at work here, it’s a general rule that the more trees there are in a neighborhood, the better it is.
7. A Compatible Vibe
Are you compatible with the culture of the neighborhood? If you’re a young family with kids, you’ll likely want to live in a lively neighborhood with lots of other parents and young children. On the other hand, if you’re a retiree, you may find a neighborhood with a lot of kids to be a little too loud and hectic. If you’re a young single professional, you probably want to live around other young professionals, not in a retiree-heavy neighborhood.
If you’re working with a seasoned agent from a company like Clever Real Estate, they can advise you on where you might fit in. As much as any other single factor, cultural compatibility will determine how happy you are in your new neighborhood.
8. Exercise and Fitness Options
Parks, fitness centers, and sports amenities like basketball courts and soccer fields don’t just provide open green space and places for community gathering — studies have shown that their proximity can make it more likely that you get in your workouts. The upshot is that the closer you live to somewhere you can exercise, the healthier you’ll be.
Study local crime rates, and compare them to similar neighborhoods across the city. Don’t rely too heavily on crime rates, though, as these kinds of statistics are often manipulated or skewed by underreporting (or even overreporting). The best way to determine the level of crime in a neighborhood is to talk to the people who live there. Ask neighbors or people walking around if they’ve experienced any problems with crime in the neighborhood, and if so, what the police response has been.
10. Does It Feel Safe?
This is a slightly different question than if the neighborhood is safe. While crime rates tell an objective (though often incomplete) story about how much crime is present in a neighborhood, the on-the-ground feel of the neighborhood can also have a big impact on how safe you feel. Is the neighborhood well-lit? Are there abandoned homes or vehicles around? Is there a neighborhood watch association where neighbors look out for each other? Do you feel welcomed?
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2. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.
11. Good Schools
If you have kids, it’s a no-brainer that you’ll be looking closely at the local schools. Check out test scores, sports programs, other extracurricular activities, the local curriculum, and school programming, as well as if there’s an active PTA or PTO. As with crime, the best way to assess the local schools is to visit them in person and talk to the parents of children who attend the school. Most schools have a Facebook group for parents that you’ll probably be able to join.
Even if you don’t have kids, you should still take a look at the schools in the neighborhood. High-quality schools are strongly associated with higher home values, so living near a good school means better appreciation and an easier resale in the future.
12. Dining Options
You probably won’t want to cook every single night, so having a few affordable, appealing dining options close to your home is a big plus. Bonus points if they’re within walking distance!
13. The Local Property Tax Rate
Property taxes can be a significant annual expense, especially if you’re moving to an area with elevated property values. You’ll want to calculate your future property tax bill just like you probably calculated your real estate commission. Also, look at recent property tax trends — have they been steeply increasing, or are they fairly stable?
14. The Homeowner’s Association Rules and Fees
If you move into an area governed by a homeowner’s association, you’ll be subject to fairly strict rules about your home and its appearance. If you want a lot of freedom to alter your home’s features and look, you may not be happy living under the authority of an HOA.
You’ll also be responsible for paying HOA fees, which can be significant. These aren’t optional, and in some places, the HOA can even foreclose on you for unpaid fees!
15. Miscellaneous Amenities
All kinds of little neighborhood features may not fall into a particular category, but that could potentially have a huge impact on your quality of life. Amenities like public libraries, music lessons for children, swimming pools or bodies of water, dog parks, tennis courts, sports fields, bike and hiking trails, movie theaters, coffee shops, art galleries, nightlife, and social clubs can all be big difference-makers when it comes to picking a place to live.
In this hot market, a lot of buyers are looking at unconventional options like off-market properties and foreclosures. A neighborhood with a lot of foreclosures is likely very affordable, but be wary of assuming that this kind of neighborhood is a sure thing for future appreciation. If a neighborhood is hit with a lot of foreclosures, falling home values can trigger lower property taxes, which then leads to cuts in public services — and that can have a dramatic dampening effect on a neighborhood’s eventual resurgence.
17. “For Rent” Signs
A lot of “For Rent” signs aren’t necessarily a bad sign — renters are often just as conscientious as homeowners. But they are an indication that community cohesion might not be as high in that neighborhood as it would be in an area with most owners. Many renters are only staying in one place temporarily, repairing their credit score or debt-to-income ratio so they can buy a place. As soon as they’re able to leave, they will. It can be hard to build a tight, trusting community when new people are moving in every year!
18. Development Plans
While a neighborhood might be ideal today, there’s no guarantee it’ll stay that way. Check with your local planning office and on local real estate sites to see what kind of projects are in the works for the neighborhood. That sedate, open neighborhood with lots of trees could change quickly if a developer decides to put in a new subdivision next door, or if the city wants to put a new highway through.
Then again, some new projects can boost home values. If a subway or light rail station is going to be built nearby, or a local commercial strip is set to be revamped, buying a property in the neighborhood could be a great investment.
19. Lot Characteristics
Once you’ve found a particular property you like, zoom in and think about the lot it sits on. Is it a larger corner lot? Is it near a major traffic route, or in a cul de sac? If the adjacent lots are currently vacant, they probably won’t always be — what seems like a private lot in open space now could seem cramped when there are new homes on either side. If you’re closing a sale in Florida, is your lot in a flood-prone location? The type of lot your home sits on will have a big effect on your living experience and eventual resale.
20. The Direction of Neighborhood Growth
Neighborhood evolution generally follows a consistent pattern; as one area develops, and prices go up, many residents and businesses decamp to an adjacent neighborhood, where home values are lower, and there’s room for more development. Once that area is built up, and home values rise, they move on to the next area, and so on.
Whether you call this redevelopment or gentrification, it’s smart to understand where you fit into this dynamic. Looking at a price map on a site like Redfin can suggest your neighborhood’s future. If your neighborhood is squarely in the path of the wave, you know that you have a good chance of seeing rapidly appreciating home values — and maybe of being priced out or finding yourself living in a neighborhood that’s a lot different than the one you moved into. On the other hand, if you’re out of the way, you can count on a more stable future — but one that might be less lucrative.
21. Strange Sounds and Smells
While this might sound weird, many communities are known for having weird sounds or odors. For example, much of Cedar Rapids, Iowa, is notorious for smelling weird, thanks to a cereal plant and a sewage treatment facility.
Other neighborhoods may be near airports or industrial areas that produce a lot of loud noises, which can interfere with your sleep, and tank your home values. In some cases, entire towns can be plagued by unexplainable sounds. Make sure you visit a neighborhood at different times and on different days to ensure you don’t sign up for something you didn’t bargain for!
22. Know Your Wants and Must-Haves
Everyone goes into a home search with a wish list of neighborhood trails and amenities. But nearly everyone has to compromise on that wish list, especially in a hot seller’s market, and especially if you’re a first-time home buyer.
To avoid serious buyer’s remorse down the line, sort the items on your wish list into two categories: wants and must-haves. Must-haves are non-negotiable necessities; for example, if you have children, good schools would be a must-have. Anywhere you move would have to have those characteristics.
In the other group, put your wants. This will include items like dining options, certain amenities, new construction, and other features that you can live without.
As you search for a neighborhood and a home, make sure you prioritize your must-haves and stay flexible on your wants.
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