Great, SaboTeam; Fallow Neighborhood
A few years ago, you bought a great old house in a neighborhood on the verge of a turnaround. But the tide hasn't turned yet. Should you sell or hold out for an upswing?
Five years ago, I bought a great old house in a neighborhood on the verge of a turnaround. But the tide hasn't turned yet, and I'm wondering whether to sell the house or hold out a little longer. Is there any way to predict an upswing?
Your dilemma is the sort of thing that happens a lot, says William Bronchick, a Denver attorney who specializes in real estate investing. "It looks like a neighborhood is starting to happen; a couple of people move in and start fixing up their homes, then it never picks up. It's always a risky move." On the one hand, you can be a pioneer in a diverse community that may one day hold your city's hottest properties. On the other, you can end up with a beautifully renovated house in a marginal neighborhood.
While there's no way to absolutely guarantee that a neighborhood will take off (or tank), there are some signs to watch out for. Make a careful study of the surrounding neighborhoods. Are there a lot of renovations in progress? How are the test scores at the local schools? Is the crime rate in the area declining substantially?
"Always buy where there's a Starbucks
moving in," says Bronchick. "It's a sure sign that things are improving."
You can also do your part to jump-start a turnaround. Maintaining your home's curb appeal should be a priority. Even if you're about to hang out the "For Sale" sign, slapping a nice coat of paint on the exterior, planting some flowers, and keeping the lawn mowed may encourage neighbors to follow suit. You can also look into starting a neighborhood watch group or a beautification project.
Finally, see if your neighborhood could qualify as a designated historic district, which can increase the value of your house.