7 Bad Neighborhood Features Every Homebuyer Should Avoid


When it comes to buying a house, everyone knows it’s all about location, location, location. For example, an out of date home in a highly desirable area will be more sought after than a newly renovated home in a rundown neighborhood. So, when it comes to getting your money’s worth, you’ll be better off buying the worst house in a good neighborhood, than the best house in a bad neighborhood. But what determines whether a location is good or bad? Here are some bad neighborhood features that will negatively affect a home's value.

SEE ALSO: 5 Renovations That Kill Your Property Value

1. Air Pollution

Say you’re house hunting online and come across the perfect home: huge lot, good size bedrooms, great curb appeal, and all at a reasonably low price. So you decide to head on over and give it a look. As you’re driving up, you notice a strange smell filling the air. What is it? It turns out, your potential new home is located a mile away from a landfill, and that stench invading your senses is the methane gas and other toxins landfills are known to produce. Suddenly that perfect home isn’t so perfect anymore, is it?

Neighborhoods in close proximity (less than two miles) to landfills, city dumps, power plants, and certain types of factories can decrease a home’s value by up to seven percent. The air pollution and strong smell that is sometimes created by such establishments can not only hurt the resale value of homes in the area, it can also affect the health and safety of those living nearby.

2. Noise Pollution

There isn’t much that can beat a good night’s rest, so finding a home in a quiet, peaceful neighborhood would be ideal. That’s why the values of homes near busy highways, train tracks, and airports can drop almost 30 percent, depending on the decibel, length, and frequency of the noise that is heard. Aside from losing sleep, studies have also shown that noise pollution can cause:

  • Hearing loss/damage to the ear
  • Stress
  • Headaches
  • High blood pressure
  • Psychological problems
  • Slower learning development in children
  • Disruption in animal behavior
  • Physical damage to property

3. Power Lines

Homes with high-voltage power lines on or near the property are also a hard sell. The large, unsightly structures are often noisy and carry a safety risk that most people would rather avoid. The presence of power lines, unless well-hidden, partially obscured, or a fair distance away from the main property, can bring a home’s value anywhere from six to 50 percent lower than comparable properties.

4. Bad Neighbors

According to the Appraisal Institute, a neighbor’s behavior can affect a home’s value more than five to 10 percent. A bad neighbor can include homeowners who:

  • Have an unkempt, poorly maintained property
  • Keep safety hazards on their property
  • Have annoying pets
  • Constantly yell, play loud music, or host loud parties
  • Have unpleasant smells coming from their property

When house hunting, it isn’t always apparent that a bad neighbor will be an issue, so if you’re interested in a house, real estate agents often advise that you check out the neighborhood at different times of the day and speak with the neighbors before putting in an offer. Keep in mind that a neighbor is someone you’ll possibly see on a daily basis, so it’s good to make sure you know what you’ll have to deal with before moving in.

SEE ALSO: 7 Questions You Must Ask Neighbors Before You Buy

5. Low Performing Schools

A huge influence in a neighborhood’s desirability is the local school district. It’s common for families to move to certain neighborhoods just so their children can get into a specific school. In fact, there have been cases where buyers will purchase a house sight unseen, merely on the fact that it’s where the best schools are located.

On the opposite side of that spectrum, neighborhoods with low ranking schools tend to be less sought after, lowering the value of the homes. If you don’t have school age kids, this may not be a big issue, but generally, the better the school district, the higher potential resale value a home will have.

6. Foreclosures Or Vacant Residences

Although it’s possible to land a good deal on a foreclosed home, a lot of foreclosures or vacant properties in a neighborhood can lower the property value of a home. This is mostly due to the condition of the homes when left abandoned. Previous owners of foreclosed homes tend to neglect the property and let it fall into disrepair. An overgrown yard, peeling paint, and broken windows won’t attract many buyers, so the asking price on a foreclosed home is usually lower than market value. Unless the home is sold quickly, this can negatively affect the value of the other houses in the neighborhood. The longer a home remains in foreclosure, the lower the neighborhood’s property values can fall.

7. High Crime Rate Or Sex Offenders Nearby

Safety is a top priority for almost everyone. Therefore, it makes sense that high crime rate areas and neighborhoods with registered sex offenders nearby are extremely less desirable. Luckily, you can look up local crime reports and the registered sex offender list online to determine which neighborhoods are the safest.

Although studies have had a hard time pinning down exactly how much negative influence crime rates have on home values, they have found that homes near registered sex offenders can drop in value up to 12 percent. So, in order to preserve the value of your home, as well the security of your loved ones, it would be best to stay clear of these neighborhoods as much as possible.

Now that you know what features to look out for, you’ll find it easier to narrow down your house hunt. If you do decide that you don’t mind the traffic noise down the road or living near a low performing school, that’s perfectly fine. Just remember that not all buyers feel the same way. So, when it comes time to resell the home, don’t be surprised if others aren’t willing to spend quite so much.

Date of original publication:
Updated on: October 03, 2016

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