Get to know the neighbors before buying a house or investment property

The Most Important Thing to Do Before Buying Real Estate

Recently, I was helping a friend house hunt. He was new to the city, and not too familiar with any of the neighbourhoods. Astutely, he wanted a second opinion in the process.

 

Deciding Which Property to Buy

After scouting about 20 houses within his budget, he had finally narrowed his choice down to two homes. Both houses were within about 5 minutes of each other and in very appealing neighbourhoods, at least they appeared to be.

Both houses sat on beautifully tree-lined streets, with neighbouring homes that were clearly owned by proud homeowners. All the houses nearby had immaculate yards with great curb appeal.

One of the two houses my friend was considering was nestled in a welcoming cul-de-sac, the Holy Grail of suburbia. The cul-de-sac even had a grassy area in the middle with a park bench surrounded by beautiful trees.

The home that wasn’t in the cul-de-sac was priced slightly higher because it had more square footage, was newer, and clearly had some finer upgrades. It was going to be a tough decision for my buddy as both properties had their pros and cons. He was leaning toward the home with more square footage, but not quite ready to commit.

His final decision, however, was made a whole lot easier because of the advice from a complete stranger…

 

Talk to Neighbours Before Buying Real Estate

When we were leaving the house in the cul-de-sac we noticed a woman standing outside on her lawn. Great, here was our chance to get real ‘boots on the ground knowledge’ of what it was like to live in this neighbourhood.

We walked over, introduced ourselves, and began asking her about the neighbourhood. She was a fantastic educator. In about a two-minute conversation we learned that:

  • All but two houses in the cul-de-sac were occupied by families with kids.
  • Only two of the homes in the cul-de-sac were being rented; the rest were owner-occupied. The lady we were speaking to rented. Without prying, we found out that she rented the home for $1,700. This gave us a great idea as to the demographics of the neighbourhood. As an aside, she also informed us that her landlord was somewhat of a lazy fellow. Apparently he never properly fixed a problem with the eaves troves in the back 🙂 It’s amazing the things people will tell a total stranger.
  • Two doors down from where my friend was looking to buy, a single woman lived who hated dogs. This frustrated the lady we were speaking with because she owned two dogs.
  • There was a little-known trail where you could let your dog off-leash a few blocks away as well, which was appealing to my friend because he too has a dog.

Lastly, and most importantly, I asked her if there were any neighbourhood issues to worry about (was there any crime?). She said “none at all”, and that it was a fantastic neighbourhood to live in – and great for children. The only issue, she said, was about a 5 minute drive away. She informed us that there was a government housing project which tended to attract some crime and undesirables. I asked her what road the housing project was on, and she let us know. “Wait a minute” I told my buddy, “that’s only a block away from the other house you liked…”

Given that neither of us were very familiar with the neighbourhood, we were completely ignorant to the fact that just about a 60 second walk down the back lane of my friend’s ‘number one choice house’ sat a sizable government housing complex.

Needless to say, that made my friend’s decision much easier. Because we took two minutes to speak with the woman who had direct ‘boots on the ground knowledge’ we uncovered critical information about the neighbourhood. This led to a much more informed investment decision for my friend. He now knew which house he wanted.

That night he made an offer on the beautiful home in the cul-de-sac… regrettably, the house was priced very competitively, and he missed out in a bidding war. That said, he fell in love with the area, and is continuing his hunt in the neighbourhood, far enough away from the housing project, I might add.

Moral of the story here: Whether you are buying an investment property or a home to live in, make the effort to speak with the neighbours so you know what you’re getting into. The neighbours and people in the area are what make or break a community.  If the house you’re looking to buy is beautiful, but the area is filled with neighbourhood dope dealers, there is a reason for that cheap price tag.

Ask questions and be an informed buyer. Get ‘boots on the ground knowledge’ before investing in real estate.

Stay hungry,

Aaron Hoddinott signature

 

 

Aaron

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Like all of you entrepreneurs and investors out there, Aaron has been in the trenches. He is the founder of an influential online media and PR company. From oil wildcatters to mining prospectors, tech gurus to medical doctors, and even celebrities, Aaron has helped market and expand brand awareness for a diverse range of publicly traded companies ran by entrepreneurs from all walks of life.

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