Signs Of A Gentrifying Neighborhood
Buying a property in a gentrifying neighborhood has its perks. For example, property prices are likely to be relatively low, allowing you to enjoy first-rate facilities at a reasonable cost. However, you have to be sure that the area is truly gentrifying. Here are four signs that can help you identify such an area:
Major Economic Developments Are Setting Foot In The Area
Most gentrifying places have one or more economic developments that anchor the rest of the smaller businesses or residents. It can be a new campus of a major university, a new airport, or a big tech company spreading its tentacles. Such major businesses will need services from other smaller business, their employees will need places to live and eat, and employees' kids will need schools and playgrounds.
It's Adjacent to Hot Neighborhoods
Gentrification rarely starts in the middle of nowhere. What happens is that once a neighborhood has developed to its potential and there is no space left in it for further development, investors start to look at the next nearest location for their businesses. This allows the less-developed area, at least in the beginning, to rely on and use the resources of its better neighbors. Therefore, if a place is starting to develop and it neighbors one or more desirable locales, it's likely that gentrification is starting to take its roots there.
Trendy Businesses Are Moving In
Some businesses don't just take their roots anywhere; they patronize up-and-coming locations to tap into the emerging wealthy population with the hope that those patrons will be brand loyalists in the long term. Such businesses, which tend to be trendy, also want to occupy the best locations ahead of their competitors. Therefore, when a trendy clothes label, fancy restaurant chain or a boutique hotel sets foot in an area, you can be sure they have done their research and identified the area as the next hot locale.
The DOM Is Declining
A gentrifying neighborhood has its properties, both for sale and for rent, snapped up faster than a low-class neighborhood that is likely to remain in the same state. Therefore, if properties used to take three months on the market and they are now taking two months or less, that's a sign that the area is developing. Of course, you need to look at the long-term DOM (days on the market) trend, and not just changes over the last five months or so.
For additional advice, contact a real estate agency like RE/MAX ELITE.