When you build or buy a home in an up-and-coming area, you buy at a lower price point. That means you now have the funds to create your ideal place. And that’s especially important if you purchase a fixer-upper that needs major repairs.
“Now you can consider retrofits and renovations that will help you build the home that you want to be in, instead of adjusting your needs based on the space that already exists,” explains Mick Lynch, Senior Vice President of Installations at Power Home Remodeling. So you can install those hardwoods in the kitchen or use those brick walls as a design element. And there’s another bonus to being in an up-and-coming area. “You tend to have more freedom to make external renovations without worrying about zoning ordinances and other neighborhood restrictions,” he says.
#3: Increased resale value
Since the neighborhood is up-and-coming, you can get in before prices start to skyrocket. And as a result of your renovations, you can significantly increase the home’s resale value. “However, just make sure you understand real estate trends in that neighborhood. [Understand] what’s happening in the market and in that specific county,” Lynch advises. He warns against relying solely on word-of-mouth, which can be misleading. “It’s important to do the research, study the people and companies migrating to those areas and let the information dictate what neighborhood is best for you.”
When a neighborhood starts to transition, Matt van Winkle, Founder and CEO of RE/MAX Northwest, says it often takes five to 10 years for it to really transform. But he agrees that buyers who get in early can see tremendous gains. “Value add or sweat equity homes in up-and-coming areas provide a lower entry point for buyers and the ability to be part of the transformation if they remodel a home,” he explains. You’re not only benefiting from the return on the remodel. van Winkle says you can also benefit from the appreciation of the neighborhood.