Picking the Right Neighborhood for Your New Home
Consider the Area’s Future Transportation Plans
There are so many exciting factors to take into account when searching for your new neighborhood. Between the local community, safety considerations, nearby restaurants, parks, and the school district, you will definitely have your hands full when it comes to research.
Depending on the area, public transportation is most likely another factor that comes to mind, but one thing that’s surprisingly often neglected is researching the future of public transportation in the area. As cities grow, their public transportation systems are bound to grow and adapt alongside them, so it’s important to look into the area’s long-term transit plans before staking roots in your desirable town. In some instances, these future transportation plans are a red flag to avoid the neighborhood if you rely heavily on public transit, like the recent L train debacle in NYC. In other scenarios, like Indianapolis’s new Red Line bus service, for example, neighborhoods can have big plans for public transportation which will not only make the region a great home base but will also hike up home prices.
When word of the L train shutdown first began back in 2016, residents, both renters and owners alike, as well as landlords started to get nervous about how this would affect home values and potential new tenants. In a community that relies so heavily on public transportation, property values greatly differ based on the proximity to public transit. After rumors soared that the train would eliminate access between Brooklyn and Manhattan entirely for fifteen months, the market completely froze, as an agent for Halstead, Warner Lewis, shares “…the winter of 2016-17 was a disaster for sellers with prices down as much as 20 percent from the pre-L train news highs.”
An economist at StreetEasy, Grant Long, estimated that renters who signed leases in 2018 scored an unreal deal, saving “..a minimum of $6.4 million compared to what they’d have paid if there were no shutdown and rents had remained flat.” Rental prices in these areas alongside the L train route dropped 1.5% since the shutdown was first announced in 2016, while rental prices in surrounding areas went up 3.3% in the past few years. With the continuous back and forth proposed L train changes, it has certainly been difficult to plan accordingly when looking to become a homeowner or rent out a unit in these popular neighborhoods, but it seems we’ve finally reached a more consistent schedule as of the Spring when the shutdown switched to a “slowdown.”
As opposed to a complete 15-month shutdown, New York Governor Andrew Cuomo announced that the L train would continue to have regular service during typical work hours—weekdays from 5 AM through 8 PM—but during the weekend trains would arrive every 20 minutes (and as we’re catching on, oftentimes even longer). While limited service is arguably better than a complete shutdown, it still has residents, both new and established, concerned about the future of public transportation in the area and has them asking a slew of questions such as: Can we trust the timeline of this new arrangement? Is the inconvenience going to continue impacting home values? While we don’t have all the answers, one thing that has become rather clear in the midst of this chaos is the fact that homeownership helps to avoid the inconsistent rent hikes, and this goes for all larger, up and coming cities across the globe.
Alternatively, blossoming cities such as Indianapolis are putting in great efforts to improve their public transportation system, encouraging potential homeowners to consider planting roots in the Crossroads of America. The city has introduced an electric bus line, Red Line. The path will run 13 miles and travel within a quarter mile of approximately 150,000 jobs. This 100% electric bus rapid-transit line runs every 10 minutes for most of the day, offering convenient service at a very affordable price—a 2-Hour Transfer Ticket at only $1.75—substantially lower than the cost of light rail. The community was on board from the get-go, voting to raise their income taxes to fund the new electric bus line. As IndyGo proudly states, “For 13 miles, IndyGo’s new Red Line is a milestone in improved capacity, comfort and comprehensive accommodation for every rider’s experience. This is big! This is bold. This is a long-awaited, proud moment for Indianapolis.”
For a smaller city, it’s often a struggle to afford the means to reshape a transit system, but Indianapolis has proudly taken a step in the right direction, with plans to introduce additional electric bus lines in the future. Home prices in this up and coming city have increased 8.7% in the past year while Zillow predicts they will rise 5.4% within the upcoming year, and it certainly doesn’t seem like a coincidence that the public transportation system is currently vastly improving. Home values in Indianapolis have gone up as much as 15.1% over the past year, and according to Little Big Homes, the real estate market forecast is extremely positive as they estimate that “the probability for rising home prices in Indianapolis is 90% during this period.”
Collectively, these current cases go to show how much these developments can affect your home and community. Most are aware that New York City is the most densely populated city in the U.S, and with Indianapolis ranked at the 17th most densely populated, it is clear that municipal transportation decisions have large implications for cities both large and small. Even if public transportation doesn’t impact you, it certainly impacts those around you, which in turn reflects home values and even current and/or potential gentrification in your neighborhood.
Yes, there is a long list of things to consider when choosing your new neighborhood, but taking the time to check this research off your to-do list will ensure you have a home you love and cherish while setting yourself up financially. Whether you’re looking for a home for you and your family, or simply for investment purposes, considering all of these factors will ultimately help you make the right choice when buying your new home.