How Determine Neighborhood is A - D?

[Jon B]

Hey Guys,

Could you explain how you determine what grade a neighborhood is from A - D? Is there a website or service you use to determine this? I will be looking for some long term rentals and want to make sure I get in the best neighborhoods for appreciation. Any help on determining the grade would be helpful.

[Daren H.]

While I believe that rating rentals is relative and subjective, I will tell you how I rate my rentals and maybe it can be helpful to you (or maybe not). I only have 3 at this time but I believe I have an A, B, and a C property. I consider Property A an "A" because it is in a "recognized" school district, established neighborhood, homes are well maintained and manicured, close access to shopping, entertainment, freeway, etc. Strong employment within close commute. My renters have been professionals (college professors, Engineers, etc.) Never had a late payment in 5 years and haven't needed to do anything but clean for the next tenant. ~$150K property value. Use to be a primary residence before I got married and moved.

Property B is a "B" in my opinion because it is in a nice neighborhood, access to shopping, entertainment, freeways, high school is acceptable (but some middle schools are better) , most people commute for employment within the metroplex. This home is 10 years older than Property A. Also can tell there is more rental activity in the subdivision than Property A. Not a crime hotspot. You could walk your dog down the street and not worry. ~$95K property value

Property C is a C in my opinion because it is in a decent working class neighborhood, schools are okay, access to freeway, nearby cities with shopping, restaurants. Home is 10 year older than Property A. Not everyone maintains the lawn/landscape, fencing, etc like they should. Signs there are a good number of renters in the subdivision. Neighborhood is low key (near rural part of city). Most people just keep to themselves. Not a lot of foot traffic day or night. ~$75K property value.

All of this may mean nothing in your market, but hopefully some of this is useful. Like I said, I believe rating rentals is subjective and relative to where you are, where and how you were raised, and the people are comfortable around.