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Neighborhood Indicators That Can Affect Home Prices

January 6, 2016

Neighborhood1For buyers and sellers alike, people want to know what the real estate market is doing and what may be expected in terms of price trends in their neighborhoods. Watching the Federal Reserve rates and how Freddie Mac or Fannie Mae respond to these fluctuations is one place to pay attention to along with comparing neighborhood sales and list pricings on homes. But there are other aspects of everyday living that can affect how much a home may be worth. In a recent article published by Realtor.com, some insight was provided on different areas to take note of before you begin your search or list your home. Below is a summary of some of these key indicators.

Current gas prices directly impact home values. According to a university study, as gas prices decrease, home prices rise. Lower rates at the pump bring in more consumer confidence and this is reflected directly with home sales. For every dollar that gas lowers, home prices increase by as much as $4,000. Homes also sell more quickly, which can make for a smaller inventory and that leads to a seller’s market as more buyers compete for fewer homes.

Neighborhood3Where you get your groceries can make a difference to the value of your home. In particular, healthier option stores such as Trader Joe’s and Whole Foods can directly impact how much a home is worth. You may think that with the pricier food costs at Whole Foods, they would warrant higher home values. Surprisingly though, it is homes that are near Trader Joe’s locations that have seen a bigger increase in value. According to RealtyTrac, homes near a Trader Joe’s are worth 5% more than homes near a Whole Foods Store. Homes also appreciate more rapidly if near a Trader Joe’s, showing an average of 40% appreciation compared to the national average of 34%

Neighborhood2Living near some major infrastructure can also affect the value of a home. Another university study found that properties near major sports arenas increased in value by up to $793 with each mile closer to the facility a comparable home is situated, up to a five-mile radius from the building. There is also something to be said about living with easy freeway access close by. While homes too close to a freeway are typically negatively impacted in terms of value, those homes which are within five miles of a freeway see better appreciation over time.

Trees can also make a difference to the value of a home. Tree lined streets are more desirable for home buyers. In a recent urban planning study, it was found that streets with trees along them added a significant amount of value to the homes located there, on average between $7,000 to $8,000 more than comparable homes. The beauty of nature outside your door and in your neighborhood can make a difference.

Buying or selling, when it is time to make a move, there are neighborhood factors beyond interest rates that are worth considering. When you have a clear understanding of what is around your home, or nearby where you wish to move to, you can have the better edge in listing your home or making an offer. When you are ready to sell or buy a home, me and my team are ready to help you through the entire process. Our goal is to make your experience both easy and pleasurable. Contact us today at (925) 634-7820, or by email at realestate@cecily.com.

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