Your Neighbors Affect your Market Value – So Say Appraisers

This news may seem either common sense or unreasonable, depending on your position, but the fact is that neighbors affect market value.

“I’ve seen many situations where external factors, such as living near a bad neighbor, can lower home values by more than 5 to 10 percent,” said Appraisal Institute President Richard L. Borges II, MAI, SRA. “Homeowners should be aware of what is going on in their neighborhood and how others’ bad behaviors could affect their home’s value.”

I showed a house this afternoon in a nice little neighborhood – house was in good condition, great yard, manageable needed upgrades … but the guy on the four wheeler flying down the road, (I think the technical term is “whizzing”), the honda racing down the road … those folks are negatively impacting the value of the entire neighborhood, not just adjacent neighbors.

Buyers can paint and replace carpet … but replacing neighbors?

I’m no attorney, but this is an attorney describing what may constitute a public nuisance (and what neighbors may be able to do about it).

After minutes and minutes of googling, I can’t find how this case in Arizona was resolved, in which this was the subject of the case, “Do you have to disclose the fact that your neighbor is disruptive before selling your house?” (no longer available)

So … if you’re buying, visit the house and the area around the house several times before you buy.

* Thanks to VARBuzz for pointing out the appraisal article