Buying a home that declines sharply in property value can put you underwater on your mortgage, erode your net worth and leave you unable to relocate for a new job or adapt to a change in household income. And one of the biggest factors that determines whether a home will rise or fall in value is its neighborhood.
That's actually a good thing, because you don't need a crystal ball to evaluate a neighborhood's direction, says Andrew Schiller, creator of NeighborhoodScout.com, a real estate research website.
"The places that tend to hold on to their value are places that basically do well across two primary dimensions that anyone can think about and evaluate neighborhoods by," Schiller says.
These two criteria are access to jobs and access to amenities. Those and a few others can help you get a sense of where a neighborhood is headed.