curious what you look at when trying to determine if an area is going through a change? how do you know an area is re-gentrifying vs. deteriorating? what data do you focus on?
I would like to know some tips on this as well.
Demographic changes can be one big sign of a changing area. Higher income people moving into the area,etc.
A good place to look at would be a neighborhood next to a hot neighborhood where people are getting priced out. Once people get priced out of that area they start to look for cheaper places nearby. I saw this happen in L.A , where neighborhoods that were once gang areas , people are now paying pretty insane amounts of money for. Like $700k+.
Interestingly a lot of these areas are still rundown looking and still have lower income residents. L.A's strong rent control laws and not being developer friendly play a role in this.
I would also look at businesses in the area , what types of businesses are opening? Are they more upscale places catering to people with some disposable income versus businesses catering to lower income people that are necessities?
Places like gastropubs, yoga studios, art galleries, trendy coffee shops are all pretty good signs I think.
Looking at what type of development is happening in the area also can be a sign. If a big developer has a project planned for the area they've probably done a lot of research that the area is up and coming or gentrifying. Of course this would be development on the higher end. Loft units ,etc.
I'd also look at what the city is doing in terms of redevelopment as well.
I'd also do a lot of research and see what articles are being posted about the area. If people all over the country are talking about an area it might be 'too late' , but if the more regional press is starting to take notice prices that might be an earlier sign.
In Los Angeles, there are a lot of neighborhoods that have gentried or are gentrifying now because the demand for housing is so high and so expensive..but even in 'lower income' ungentrified areas houses seem to be $400,000 plus , which is pretty crazy.
I'd look at downtown areas, or walkable areas as there is a big trend of people wanting to live in a walkable part of town, and it looks like many downtowns in America are being redeveloped and revitalized.
A lot of money can be made by investing in gentrifying areas at the right time.
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