Title Order Form
What’s the secret to getting the most from the future sale of your property?
Buy in an up-and-coming area. Ideally, one that people will be vying for in a few years. The question is how to find that next hip neighborhood before it becomes desirable.
In the following article, we’ll share some smart strategies you can use to get ahead of the curve.
- Start by looking on the outskirts of current hot neighborhoods. As a neighborhood becomes increasingly popular, real estate values there begin to rise. Eventually, availability and affordability become factors, forcing those who want to be close to the action to look elsewhere. In this “spillover market” situation, home buyers expand their search to just beyond the current trendy area. As more and more people begin to inhabit these adjacent communities, they’re likely to ultimately become sought-after, as well.
- Pay attention to new construction. As an area becomes more popular, construction begins to boom. If you notice that new buildings and restorations can be found on virtually every corner of a community, it’s likely on the verge of becoming a hot place to live. When numerous homes are being renovated to sell for a profit, also known as flipping, this is an indication that real estate investors think the neighborhood is up-and-coming.
- Watch for declining “days on market” measurements. Days on market (DOM) indicates how long a property has been up for sale. The shorter the DOM, the hotter the market. Get a sense for decreasing DOM by checking out comparable home listings in the area. If many properties are being sold within days, that’s a good indicator that it’s becoming a sought-after community.
- Safety is on the increase. It’s always wise to make researching local crime rates part of any new home search, but it’s especially important when you’re checking out areas in transition. If safety is on the rise, it means that market is becoming attractive to a broader spectrum of safety-minded buyers, such as women and families with young children. To get crime details on potential communities of interest, check out Trulia’s heat map by neighborhood. You could also scour local blogs and news sites to get a feel for the safety in any area you’re considering.
- Millennials are moving there. Younger buyers are usually priced out of established neighborhoods, which is why they often lead the way in the resurgence of neglected neighborhoods. Once they move in, restaurants, bars and grocery stores tend to follow.
- It’s home to artists and musicians. Like their youthful counterparts, artists and musicians often lead the way to a neighborhood’s resurgence because they live on shoestring budgets and look for cheap rent. Once they begin moving to a given area, others follow. These creative folks usually make their neighborhoods look cool, and people like to be near that artistic energy. As more people flock in, things get hip and home values begin to skyrocket.
- Look for favorable demographic trends. Think empty nesters downsizing, working professionals who want to live downtown, or growing numbers of college-age residents. These are all examples of shifts in the population that can be powerful leading indicators about up-and-coming neighborhoods.
- Keep an eye out for retail growth and additional amenities. If you hear that public transit systems, infrastructure projects, schools, healthcare facilities and new shopping centers are in the works, it’s a good sign that the location is emerging and expecting significant future growth. This is particularly true if the plans call for retail giants like Walmart, Starbucks or Home Depot. They’re not going to spend millions opening a new store unless there’s strong evidence that it’s going to be a profitable venture.
Financially, it’s good to own property in a location that’s appreciating rapidly.
And it’s always better to be in an area that’s revitalizing rather than declining. While it’s not an exact science, there are a number of signs that could point you to the next up and coming neighborhood. What may look a little shoddy now may very well be a diamond in the rough and an excellent real estate investment.
The Certified Title team is here to offer helpful insights and valuable resources that enhance all types of residential and commercial real estate transactions. For more information about how to find the next hot neighborhood in your area, please contact our knowledgeable professionals.
About Certified Title Corporation: Since 1994, attorney-owned Certified Title Corporation has been furnishing residential and commercial real estate stakeholders across the nation with robust title insurance, settlement, and escrow services. Renowned for their industry-leading reliability and exemplary level of service and quality, the Maryland-based company helps clients from all walks of life achieve their asset goals. To learn more, call (888)486-5511 or visit https://www.certifiedtitlecorp.com/.