6 Neighborhood Red Flags

By Erin Joyce | August 24, 2010 AAA

Your house would be absolutely perfect โ€“ except for your next door neighbor's 2am band practices and the family across the street's fondness of using your garbage cans when theirs are full. There are some characteristics of a neighborhood that you just can't know until you move in, but there are many aspects of your potential home's location that you can scout out ahead of time โ€“ and that can save you from a lot of headaches later on. Beyond more obvious signs, such as graffiti and run-down buildings, here are six red flags worth looking for if you are in the market for a new home. (For more in the homes market, read Simple Ways To Invest In Real Estate.)
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  1. Local Businesses
    Check out the businesses that are close to your new home. If there are a lot of tattoo parlors, pawn shops and payday loan stores, that could be a warning sign. That isn't to say that those businesses are inherently bad; they each provide a service and are perfectly safe to frequent. One or two of these businesses in the area isn't cause for concern, but if they are on every street corner, it is worth noting as a possible downside of the area.

  2. Homeless Population in the Summer
    If you drive through a neighborhood and see 20 homeless people in as many minutes, that's a clear warning sign. However, if you live in a climate with a formidable winter, you may only get a true sense of the homeless population in the summer. Also, if you are looking in a busy city, you may not be able to find an area completely free of the homeless; if you are unwilling to move farther into the suburbs, this may be a tradeoff you can live with. (Find an easy way to avoid some of the obstacles of buying a home, in Do You Need A Real Estate Agent?)

  3. Empty Storefronts
    This can be tricky, because empty storefronts could also be signaling an area in transition, which may be a good thing if your plan is to flip the property in five to 10 years. If that isn't your goal, those corporate for rent signs may indicate that businesses don't want to be there. Low demand in an area may not attract the kind of businesses you would like to see near your home. At the very least, it's another potential store or service that you won't have access to. (Learn more, in 5 Things Every Real Estate Pro Knows.)

  4. Police Presence
    As Richard Baker of BuyYourHomeGuide.com points out, police departments assign officers to the area where they are most needed. If you notice a lot of police cars patrolling the area, that may be a bad sign.

  5. Street Maintenance
    This may be more noticeable when snow is on the ground. See how quickly the snow is removed, if the sidewalks are cleared, and if they salt the roads. In the summer, see if there are city-planted trees and plants along the roads, and if they are taken care of. More obviously, if there is a lot of trash that doesn't seem to be cleaned up over time, that's a red flag.

  6. Neighborhood Activity
    When the weather is nice out, watch for bake sales, yard sales, block parties and, in the city, street festivals. Are there kids out playing in the front yards and streets, or are they relegated to the backyard and inside? Do people spend time out on their porches or walking in the neighborhood?

    These are all signs of a friendly neighborhood; but that isn't for everyone. These same signs can be a reason to discount an area if the thought of participating in a neighborhood barbecue makes you queasy. However, if people are comfortable spending time out front of their properties or around the neighborhood, it could indicate that the area is relatively safe. (Find out more, in 8 Signs Your Neighborhood Is On The Upswing.)

A Disclaimer
If you are looking for a home for a family of five, you may be more put off by a high homeless population than a working couple interested in living in a busy downtown core. None of these signs should immediately disqualify an area you are considering, nor should they cause you to run out and put your own home on the market. Before you start looking, make a list of attributes your ideal neighborhood would have, and carry it with you when you scope out potential locations. Also, be careful to consider your home in the context of the area โ€“ paying twice as much for the by-far nicest place in a four-block radius may make reselling tough.

The Bottom Line
You can't change the location of your home once you buy it. A beautiful home might be tough to sell if the neighborhood isn't that great, so be careful where you choose. Everyone's definition of a bad neighborhood is different, but you can't go wrong looking for a neighborhood that is safe and clean. (For related reading, take a look at 7 Must-Have Real Estate Contract Conditions.)

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