Here are some nuggets from the podcast that i've put together.
When looking at the
area you find a deal-
Look
for the medium household income and if the that medium household income would
support the rent you would need to charge. Rent should be 3-3.5x household
rent. So an area with a medium household income of $30000 can support $1000
rent, for example. This tells you your pool of potential renters is large
City-data.com
Richblockspoorblocks.com
Less
than 15% population in poverty
Not
in a flood zone (check FEMA website)
Low
crime area, you can check Trulia they have heat maps- you can visit police dept
for information too
Check
the development calendar on the website of the city/town/county if you can find
it
You want an increasing population, an increase in employment or jobs opening up in the area
This question unfortunately does not have a strait forward answer. Many factors come into prices a few of which being; amenities or proximity to them, demographics, local government policies, and many other things.
One example is a concert venue is being built, naturally the neighborhoods that are closer will start to rise in value because people would like to be close to it, and or STR demand will also rise in the areas immediately adjacent to it.
A few resources I would look at is local government websites, local news stations to pay attention to developments and other applicable news, and lastly, watch home prices. If you see houses going fast in a certain area it could mean that people are starting to love it, or if you see a ton of flips pop up for sale the flippers think its great, why wouldn't you?
@Bianca Rodrigues Talk to the investors/developers in your town about this. They generally have their ear on the ground regarding up and coming areas
Also talk to local real estate podcast hosts since they feed off of information and know about developments right after the developer of the project themselves
I think this falls under the category of local knowledge. I don't think there is any other way to know. You need to know the area intimately to make that type of determination.
Here are some nuggets from the podcast that i've put together.
When looking at the
area you find a deal-
Look
for the medium household income and if the that medium household income would
support the rent you would need to charge. Rent should be 3-3.5x household
rent. So an area with a medium household income of $30000 can support $1000
rent, for example. This tells you your pool of potential renters is large
City-data.com
Richblockspoorblocks.com
Less
than 15% population in poverty
Not
in a flood zone (check FEMA website)
Low
crime area, you can check Trulia they have heat maps- you can visit police dept
for information too
Check
the development calendar on the website of the city/town/county if you can find
it
You want an increasing population, an increase in employment or jobs opening up in the area
@Bianca Rodrigues as others have mentioned, there are a LOT of factors to consider. Although you definitely should consult the relevant data, at the end of the day, nothing beats boots-on-the-ground firsthand experience with a neighborhood.
There are a lot of important factors that are not well-conveyed in data, photos, or via websites. For instance, it's somewhat common for a property to be in a zip code that has GREAT data (high income, great schools, low crime, etc.)--but, the property happens to be on the other side of a major road, and where the property is located, there's actually significant problems with crime, and avg. income is very low. Within a single zip code, there can be A, B, C, and D neighborhoods, and sometimes just crossing the street makes all the difference--and this is often NOT conveyed in data or on websites. Hence, the importance of seeing the area for yourself.
Most beginning real estate investors would be well-advised to only buy property in neighborhoods they've actually visited. IMO, buying a property without seeing the property and neighborhood with your own eyes is a bit like buying a used car without verifying that the car even runs.