How to Choose a Neighborhood

Choosing a Neighborhood

When purchasing a home the neighborhood in which it is located is a very important feature to consider. It can also be an important consideration when a property appraisal is being made. As a homeowner selecting a neighborhood involves evaluating several features such as the growth rate, property value trends and housing demands in the area. These are all things that a property appraiser will be looking at as well, this is one reason it is important for potential homeowners to be selective of the neighborhoods where they purchase a home.

What factors will a property appraiser look at in the neighborhood?

There are certain things that a property appraiser will be considering when offering a property appraisal. They will look at the actual location and whether it is rural or urban. And they will consider the neighborhood’s growth rate. How well is the area built up? If there is an oversupply of properties in the area it will be difficult to sell later on. Property values in the area are also considered; whether they are increasing or decreasing can be a major selling feature.

Neighborhood Characteristics for Homeowners to Consider

There are three basic features in a neighborhood that can be weighty matters; location, growth rate and how they are built up. Rural properties are not going to be valued as highly as urban or suburban areas will be when they are evaluated by a property appraiser. This is partly due to the fact that they are typically a much slower market and they have substantially longer market times than neighborhoods that are in urban or suburban areas. Rural properties can be more difficult to value because they can each be so different in terms of agricultural influence, housing designs and styles and the larger lots they are typically located on.

A property appraiser such as Abbe Edelman will also consider how developed a neighborhood is. Usually if the neighborhood is less than 25% developed it can be a negative factor when it comes to the property appraisal. Most of the time urban and suburban areas will have higher built-up rates and will be reflected in appraisals. However, if a neighborhood has a built-up rate over 75% it can be very tricky when it comes to valuation because it will be an indicator of market inconsistencies.

Growth rates in different neighborhoods can indicate how the area is developing. It is not until all of the surrounding land is completely developed that a neighborhood is considered to be stable. When development in a neighborhood is slow it may indicate that prices are growing weaker so potential homeowners may be better off waiting or choosing a different neighborhood. However, a neighborhood that is considered to be growing rapidly is most likely a solid neighborhood to purchase property.

Examining Trends in Housing

Property values in a neighborhood are a very important consideration. This will have an influence on the property that the homeowner is considering for purchase. Supply and demand is also an important feature to consider. If there is an oversupply of property, then the overall value of property in the neighborhood will decrease. It is best for the buyer if the supply of houses is greater than the demand for them. This can help keep the prices down and can make it easier to purchase a home.

The price range of homes in a neighborhood is very important as well. When a potential buyer is selecting a neighborhood it is essential that the price be similar to the general prices in the area. A property appraiser should not overprice houses when making their assessment.

The neighborhood boundaries and description are also essential elements. Establishing the boundaries of a neighborhood will help a homeowner isolate the properties which need to be compared as they should all be in the same neighborhood for a fair assessment. And the official description of the neighborhood is important not only to identify it but also to discover the true marketability. It is important to consider the location to certain things such as amenities, employment or neighborhood centers and also any adverse influences.