Have you ever looked at two similar homes located just a few miles away from each other, and been amazed at the difference in price? Home value does not depend on just the home itself, but also on the neighborhood. So, what impacts neighborhood property values? Here are a few key factors.
People will pay a lot more for a home in a good school district. If one school district has above-average test scores and a neighboring district has below-average test scores, the homes in the first district will sell for a lot more. Parents, especially, are willing to pay more for a home that allows them to send their children to better schools, so the prices of homes near good schools tend to be especially affected by this difference.
Proximity to Amenities
How far is a neighborhood from grocery stores, parks, banks, and other basic amenities? Home values in neighborhoods with these amenities easily accessible tend to be higher. If people can walk to various amenities from their homes, this tends to drive values up even higher.
In neighborhoods with lower crime rates, homes tend to cost a lot more. This can even be broken down by the rates of certain types of crime. High rates of violent crime will drive home values down significantly. High rates of non-violent crime don't have quite as profound an effect, but there is some effect.
How are the roads in a certain neighborhood? If they are well-maintained and mostly free from potholes, then the homes in that area will sell for more. If the roads in a neighborhood have extra features, such as bike lanes or really nice walkways, then this can also raise property values. It's not just about safety, either. Well-maintained, nice roads are easier on cars, and those with bike paths make it easier for residents to stay active. These features increase demand in the neighborhoods, and increased demand raises prices.
If the area has a homeowners association, that tends to raise property values. HOA regulations often ensure that neighbors maintain their property to a certain level, which keeps the area looking clean and attractive. People will pay more for a home with neighboring yards that are clean and attractive.
Hopefully, this article has given you a better understanding of the factors that affect neighborhood property values. Your real estate agent can help you find neighborhoods that suit your needs, cost-wise.