You think you've chosen to live in the perfect neighborhood until you realize your neighbor jams every night on his electric guitar while you're trying to sleep every night. While there are some characteristics of a neighborhood that you just can't know until you move in, there are many aspects of your potential home's location that you can scout out ahead of time.

Doing your research or getting a great agent to help you find the right place can save you from a lot of headaches later on before you sign on the dotted line, whether you decide to make the move for yourself or if you plan on purchasing an investment property. 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.

Key Takeaways

  • Make a list of your preferred neighborhood attributes, be realistic, and be willing to sacrifice if you can't get everything.
  • Check out the local businesses in the area and check to see if it has a large homeless population.
  • Be wary if you see a lot of for sale and for rent signs, as well as a heavy police presence.
  • How well a neighborhood is maintained along with whether there's a lot of activity in public spaces is a sign of a good versus undesirable neighborhood.

Make Your List

Everyone has an idea of their perfect neighborhood. And that often differs from person to person, so what you consider a great attribute may be a deterrent for someone else. Before you start looking, it's a good idea to make a list of the characteristics of your ideal neighborhood. When you're out looking and scoping out potential locations, make sure to carry it with you. And 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.

When you're making your list, prioritize your items. Keep your must-haves at the top, while leaving the attributes you're unsure of at the bottom. And remember, be realistic because you won't get everything. While you shouldn't sacrifice, there must be a few things on your list from which you're willing to part. If not, you'll probably be looking for a while.


6 Neighborhood Red Flags

Local Businesses

Even if you decide to look in a fairly residential neighborhood, it's important to be within a fair distance of local businesses. You don't want to have to go too far to be able to do your shopping, grab a bite, or just spend time outside the house. That said, it's important to have the right kinds of businesses around you.

Check out the businesses that are close to your new home. If there are a lot of tattoo parlors, pawnshops, and payday loan stores, that could be a warning sign. That isn't to say 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 shouldn't be cause for concern, but if they are on every street corner, it may be a possible downside of the area.

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 an area with a formidable winter, you may only get a true sense of the homeless population in the summer. If you are looking in a busy city, you may not be able to find an area completely free of the homeless. The tradeoff is to move farther off into the suburbs—that is, if you're willing to make the move and if you can live with the fact that you're away from all the action.

For Sale, For Rent

One of the most obvious red flags is the mass exodus of residents out of an area and empty storefronts. If you drive or walk around a neighborhood and see a lot of for sale signs, you may want to think twice. There may be a problem in the area that may not be obvious to you. If you get the chance, talk to the people in the area to see why they're all selling.

Empty storefronts can be a little trickier to judge because it could signal an area in transition, which may be a good thing if your plan is to flip the property in five to 10 years. There may be a developer who's working to convert these empty businesses into new retail space. But If flipping 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 be able to access.

Police Presence and Crime Rate

Nothing says safety like seeing the police patrol your area. But that isn't always a good thing. Most police departments assign officers to areas where they are most needed. If you notice a lot of police cars or officers patrolling the area, that may be a bad sign. It may be even more of a red flag if you see more cops during the day than you see at night.

A higher police presence in the daytime than in the evening may be more of a red flag.

This leads to the neighborhood's crime rate. You can check the statistics online through some of the popular real estate websites. They'll give you an idea on what types of crime are prevalent, if any, in a particular area.

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 how well they're maintained. But if there is a lot of trash that doesn't seem to be cleaned up over time, that's a red flag.

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 in front of their properties or around the neighborhood, it could indicate that the area is relatively safe.

The Bottom Line

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.

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.