Saturday, June 16, 2012

7 neighborhood threats to your home's value (cont.)

Delinquent bill payers. One surprising way neighbors can bring down the value of surrounding homes, especially in town home or condo communities, is by not paying their maintenance fees or mortgages. Bad neighbors bring values down by not paying their maintenance fees, in some cases their mortgage payments, and not maintaining the home's appearance. These homeowners usually do not care about real-estate values.

Foreclosed homes. Perhaps the biggest single factor that drives nearby home values down is a foreclosure. A recent study by the Massachusetts Institute of Technology concludes that the value of homes within 250 feet of a foreclosed property will decrease by 1% per foreclosure, on average. Federal Reserve Governor Joseph Tracy said recently in his economic outlook for 2011: The growing inventory of defaulted mortgages continues to weigh down any recovery in the housing market … Problems in housing markets can impact economic growth.

Lackluster landscaping. Studies show that lawn care has a big impact on surrounding home values. Virginia Tech University released a report stating that pristine landscaping can jack up the value of a home by 5% to 11%.

Closed schools. Sometimes, neighborhood problems can stem from local government action. For example, if a cash-strapped city or town closes a neighborhood school, that can easily steer home values south. The National Association of Realtors says 75% of home shoppers say the quality and availability of schools in the neighborhood is either “somewhat important” or “very important.”
So can you fight back against problem neighbors? In the case of a landfill, power plant or sex offender, your options are severely limited. As long as your neighbors are following the letter of the law, you’ll just have to grin and bear it — or move. If not, you have every right to petition your local government authorities for a grievance and at least get the matter reviewed.
If it’s a residential property causing the problem, however, you might have better options.
For starters, you can leave a polite letter in the offending homeowner’s mailbox to get his attention. In addition, Pordes says that if the home is within a homeowners association or condo association, the association can send letters to the homeowner and deny him community privileges to encourage him to comply with the community rules and maintain home values.
Most cities and towns have ordinances against messy yards and junk-laden driveways, so check your community’s rules and regulations to see what applies.

Unfortunately, many cities and towns also have landfills, power plants and other less-than-desirable commercial-sized neighbors. Most likely, you’re just going to have to live with them.

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