Regardless of familial status, the safety of an area is always high on prospective homebuyers’ priority list.
That’s why a recent nationwide study by WalletHub should be on real estate investors’ minds before buying property in a market with which they’re unfamiliar.
From cybercrime and home burglaries to the presence of law enforcement and natural disasters, financial analytics firm WalletHub analyzed more than 180 U.S. cities across 39 key safety metrics. The dataset includes such metrics as assaults per capita, the unemployment rate, road quality, traffic fatalities and many others.
“No one can avoid all danger, however, and we take on a certain level of risk based on where we choose to live,” WalletHub wrote in its analysis. “Some cities are simply better at protecting their residents from harm.”
Whether physical or virtual, threats to safety impact a property’s value as well as the long-term growth of a market. For instance, violent crimes are especially more influential on property values. For every 1 percent increase in violent crimes, the price of homes in the area falls 0.25 percent., according to Academy Mortgage. People are also more likely to flee an area affected by crime, leading at times to a shrinking population.
There are a variety of reasons real estate investors should keep these trends in mind.
An area’s crime rate is an important consideration for investors as higher rates of crime bring increased risk to the property itself as well in the form of higher vacancy rates and higher delinquency rates. Higher vacancy rates and higher delinquency rates essentially translate into higher expenses that can cut into potential profits. Some investors, however, might be willing to take on the extra risk because higher crime areas can come with higher potential returns.
Crime rates and an area’s overall safety can also affect your investment strategy. If your primary target market is for families, for example, you might aim for prospects in safer cities that tend to draw the interest of buyers with children or that plan to have children. If you already have property in less safe cities, make sure you’re protected with adequate insurance and consider offering security features to tenants.
Below you can see WalletHub’s top 10 ranking of the safest cities as well as the least safe cities in America in 2018. Below the ranking, you’ll find an interactive map in which you can explore the more than 180 cities WalletHub analyzed. To learn more of WalletHub’s methodology for this study, click here.
Safest Cities in America
1. Columbia, MD
2. South Burlington, VT
3. Plano, TX
4. Virginia Beach, VA
5. Warwick Beach, RI
6. Gilbert, AZ
7. Yonkers, NY
8. Bismarck, ND
9. Nashua, NH
10. Boise, ID
Least Safe Cities in America
173. Jackson, MS
174. Los Angeles, CA
175. Wichita, KS
176. Oklahoma City, OK
177.Detroit, MI
178. Little Rock, AR
179. Baton Rouge, LA
180. San Bernadino, CA
181. Fort Lauderdale, FL
182. St. Louis, MO
0 Comments