Five Ways to Tell That a Neighborhood Is About to Change (for the Worse)
There are a lot of factors that go into buying a house, but one of the most important is the neighborhood around it. In fact, for people who love their homes, the second-most listed reason is the neighborhood it's in.
But one thing people don’t always consider when house hunting is that neighborhoods can change. This is often an organic process as families move in and out of the area, subtly shifting the vibe and traditions each time. But sometimes neighborhoods undergo huge, sudden swerves thanks to development plans and other factors that directly affect every aspect of an area. The bad news is that this means you could find yourself stuck with a house in an area you no longer love. The good news is that, with a little detective work, you can tell if a neighborhood is about to change before you buy a house there.
Empty lots
One easy, obvious sign that a neighborhood is on the verge of a major transformation? Empty lots—especially if they’re being actively monitored and worked on. Even if the lots have been empty for a long time and the locals have gotten used to them, there might be long-term plans to develop them into something. This is especially true of very large parcels (50 acres or more) that could easily become mixed-use or commercial developments in a rapidly growing area.
There are a few clues that an empty parcel of land will someday soon ruin your idyllic neighborhood:
Environmental remediation. Look for signs indicating that a cleanup process is being conducted on the land to remove or seal in pollutants. These projects often take years and can seem dormant for months or years at a time, but indicate that a developer has plans for the land.
Utility extension requests. If the owner of the land has plans to develop the lot, they may have requested permission to run sewer and water lines to the lot long ago. These requests are public records, so you can find them at your local Public Utilities Board or similar government office.
Recent transactions. If someone has recently purchased empty lots in the area, it’s often a sign that a development plan is in motion. You (or your real estate agent) can check local sale records to see what’s happening nearby.
Check the plan
Something pretty obvious that a lot of people sleep on is the fact that most local governments have a master plan for future development, and it’s almost always a matter of public record. Taking a look at a master plan for your area will give you a warning about any large mixed-use or commercial developments that might be years away. It’s also often a good idea to check out the minutes of local city council meetings to see if any development plans have been debated recently. Something else to look for? Efforts to declare your neighborhood a historic district, which can change the tenor and livability of an area drastically.
Even if you don’t see any evidence of major changes to your specific neighborhood, something else to look for is companies moving into commercial or office space relatively nearby. An influx of large corporations setting up shop in new buildings nearby could trigger a future wave of new roads and mixed-use developments to support that population of commuting workers, and some of that development will no doubt impact your neighborhood.
Look at new road projects
Most people avoid buying a house next to a busy road. But what happens when a busy road moves near you? Local and state governments are constantly considering new road projects to alleviate traffic and provide access to new commercial developments. Even if your house is a few miles from the nearest highway, over time (and not as much time as you might imagine) those roads can creep closer and closer.
You can’t predict what might happen decades from now, but you usually can check to see if new road projects are already in the works. Your state’s Department of Transportation probably has a web page where road projects are listed and updated—New Jersey, for example, has information on several road repair and construction projects, complete with budgets and estimated completion dates. A few minutes on a page like this could spare you years of frustration as an overpass is built in your backyard.
Check the zoning laws
I mentioned checking out city council meeting minutes earlier. This is always a good move when considering moving into a new area, because it not only shows you what’s happened in the past, but also what local folks are considering for the future. Will local zoning laws change, permitting mixed-use properties in your neighborhood? Is someone asking for a variance so they can run a business next door to your house? Reading through some city council minutes can give you the warning you need.
You can also usually contact the planning or zoning departments directly to simply ask about pending changes that might impact your neighborhood.
Time the assessments
When my wife and I bought our house, we weren’t aware that the city hadn’t conducted a property revaluation (aka a tax reassessment) in 14 years. Ten years (!) later, the city finally announced a fresh assessment, and everyone in our neighborhood braced for a shocking increase to our property taxes.
If we’d done a little research before buying the house, we may have still gone ahead with the purchase, but we would have done so with the knowledge that our property taxes were artificially low. There’s no real standard for how often a municipality will reassess property taxes, but it typically happens every five to 10 years at most. If you look at the tax records for your potential neighborhood and see it hasn’t happened in more than five years, you should consider the real possibility that your taxes will shoot up shortly after you buy the place. This can impact your neighborhood if it drives residents—the neighbors who make the place so nice to live in—to move away and sell their homes to wealthier folks who might turn the place into a construction zone as they gut-renovate everything in sight.