Neighborhoods have a tremendous impact on house price (for past, present, and future), more than any other factors and therefore I recommend researching on neighborhoods before researching on a house. Below information can be obtained from internet on a neighborhood:
- Traffic: Calculate expected commute for anyone expected to live at the property. How long is your expected daily work commute?
- School rating: Even if you don’t have any kids and don’t plan to attend any public school, school ratings are important because it effects price and price elasticity. Neighborhoods with great public school system are highly sought after and they are easier to sell and provide rent.
- Amenities: Is the neighborhood good for outdoor activities? How close are restaurants and groceries? Can you get to places on foot or will you have to drive? Where is a nearest hospital and emergency room?
- Statistics: Look for all statistics on the neighborhood such as crime rate, average temperature and weather, average household income, demographics, ethnicity, and real estate price trends. Zillow.com is a great place to begin statistics research. Visit the city website for further statistic details.
- Owner vs Renters ratio: What is the percentage of people renting their place versus people owning their place? What is the range of income?
- Interest rate trend: Buying at higher APR means monthly payment will be higher but you could refinance the house if APR lowers.
- Vibe: Does it have vibe that you want?
If possible drive around the target neighborhood in case you are not familiar with the area. During the drive, visit open houses to get a feel for actual houses in the neighborhood.
If your affordability has been determined (see Preparing for House Hunting), the type and size of house you can afford in each neighborhood can be determined whether it is a single house, townhouse, or a condo. Imagine a house you want to live in and consider the trade offs based on your affordability. Are you okay with living in a small house/condo for better commute and school? Or would you rather live in a big house with long commute to your work?