Your house would be absolutely perfect – 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 – 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.)
IN PICTURES: 6 Tips On Selling Your Home In A Down Market

  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 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 – 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.)

Water Cooler Finance: A Diving Dow And Rotting Eggs.

Related Articles
  1. Retirement

    5 Ways to Use Your Home to Retire

    Retirement is going to cost a lot, and for homeowners who face a shortfall, their home can be a source of income. From downsizing to renting, here's how.
  2. Home & Auto

    Read This Before Buying a Vacation Home with Friends

    Going in with friends to buy a vacation home will save you on the mortgage and expenses. But if there's conflict, it could end up costing your more.
  3. Home & Auto

    The Most Expensive Neighborhoods in London

    Understand what makes London such a desirable place to live and why it is so expensive. Learn about the top five most expensive neighborhoods in London.
  4. Home & Auto

    Why Housing Costs Shouldn't Exceed 30% of Your Budget

    Financial experts will argue that there’s no problem with allocating 50% of your net income to housing, but that barely leaves enough money for living comfortably. Reducing housing expenses to ...
  5. Investing Basics

    Tiny House Movement: Making Market Opportunities

    The tiny house movement throws all assumptions about household budgeting and mortgage management out the window, and creates new market segments too.
  6. Investing

    Where Should I Keep My Down Payment Savings?

    While saving up for a down payment, where should you keep your money. A bank? The stock market? It all depends on your timeline.
  7. Home & Auto

    The Most Expensive Neighborhoods in Manhattan

    Understand why Manhattan has some of the priciest residential real estate in the world. Learn about the top four most expensive neighborhoods in Manhattan.
  8. Home & Auto

    The Most Expensive Neighborhoods in Los Angeles

    Understand the layout of the greater Los Angeles area and what is driving up home values. Learn about the top eight most expensive places to live in LA.
  9. Credit & Loans

    Yes, You Can Buy a Home with a Reverse Mortgage

    A special type of FHA-insured reverse mortgage called the HECM for Purchase lets seniors use a reverse mortgage to buy a home.
  10. Home & Auto

    Before you Buy That Home: Find a Great Realtor

    Most people think of a good realtor as a successful salesperson, but we should not assume than that's what makes a great or even a good realtor.
  1. Can I borrow from my annuity to put a down payment on a house?

    You can borrow from your annuity to put a down payment on a house, but be prepared to pay an assortment of fees and penalties. ... Read Full Answer >>
  2. Can I take my 401(k) to buy a house?

    Once you reach 59.5, you can use the funds in your 401(k) retirement savings account to buy a house or any other expense ... Read Full Answer >>
  3. Can I take my 401(k) to buy a house for my children?

    Under the standard regulations for 401(k) retirement savings plans, you may elect to withdraw funds from your 401(k) for ... Read Full Answer >>
  4. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  5. What does the American Dream mean to different generations?

    The American Dream at its core is the belief that every generation should enjoy greater prosperity than the generation before ... Read Full Answer >>
  6. When should a real estate broker release earnest money deposit funds?

    As soon as an agent or broker accepts an earnest money deposit, he becomes an escrow agent. This means that, in most cases, ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!