You know the paramount rule of real estate – location, location, location. Buying in a good neighborhood makes sense on a lot of fronts, but how do you know if you are looking in one?

Nobody wants to buy a home in a bad neighborhood. Still, it happens a lot more frequently than you might think. Why? Well, it can be difficult to evaluate whether you are in a good or bad neighborhood just by driving through it. To avoid bad decisions, you need to research the area. Asking your real estate agent their opinion is not research. They are trying to get a transaction done, so keep that in mind.

The first issue to assess is the economic status of the area. Obviously, you want to live in an area where people have jobs. Jobs equate to money, which means rising property values over time. So, how do you do it? Well, you can dig up statistics on jobs, unemployment and so on, but it can get confusing. A better approach is to drive around the neighborhood and look at how many homes are for sale. If there are a lot, the economic situation is not good. If you see even one empty home, high tail it out over there as fast as you can.

Walking is good for your health. It is also a good way to evaluate a neighborhood. No, you don’t have to walk. Instead, take note of how many people you see walking around. Don’t do this assessment on a Monday in the morning. That isn’t fair! Try a Saturday when people are off work. Keep the windows down as well so you can evaluate whether the area remains quiet or turns into Woodstock. If you are at all concerned about the noise level, cruise the neighborhood on Friday and Saturday night.

Schools are an oldie, but goodie. Quality schools are a sign of a good neighborhood. Most people without kids discount the school issue, which is a huge mistake. Yes, you don’t have kids, but what about when you resell the property? Families are going to make up a large pool of your potential buyers. They are going to be very interested in the quality of the schools, so you should be as well.

Home conditions are another huge factor you need to consider. In this case, we are not talking about the quality of construction and so on. Instead, how are the homeowners taking care of their homes? Drive the neighborhood and look at the homes? Are they run down? Cracking paint? Yards that look like the Amazon rainforest? All are warning signs that should make you reconsider buying in the area.

When house hunting, it is easy to fall in love with a particular property and not really notice the neighborhood. This is a recipe for disaster. Make sure you carefully evaluate the neighborhood around you to avoid buying in a bad area.