Blog Post 2
When searching for a new home
to purchase people look at many factors that help them determine the value of
the home they are looking for. Researching the real estate market in the area
where one wants to live in is very important prior to buying a home. When an
individual looks at the full spectrum of property values they take into consideration
knowledge of when the home was built, the lot size, square footage of the home,
how great the education is in the surrounding schools, crime statistics of the
city and neighborhood, the status of the neighborhood where the home is, and
many other factors that can affect the property value of the home. Perceived
value will also play a roll in how much an individual can buy a home for, this
can drive the price of the home up. Most often market values of properties are
almost always decided by the property’s accessibility. “The more accessible a
site, the higher rent a site can command, a higher rent would result in higher
land value” (Diaz, Julian). There are times when property values vary in prices
even though they might have the same accessibility. Reedley California is a
small town of a population close to 25,000 (Welcome to Reedley). Reedley is
a quiet community with a beautiful flowing river and a junior college. Reedley
was incorporated in 1913 (Community History), since then there has been great
expansion that brought along new housing development opportunities. As the city
expands and new housing is available for the citizens, the older developments
get left behind and, as it typically happens, these older neighborhoods are the
ones that are valued the lowest in the city and the newer ones have a higher
price. Although this is true in Reedley, there is a good mix of price ranges
between newer and older developments. The factors described earlier determine
the value of the homes in Reedley California, which separates them into three
categories: low-income housing, middle class homes, and upper class homes.
Reedley’s real estate
market is not a huge market, but it provides a good example of how home values
relate to accessibility of the land and also to the relating determining
factors within the surrounding area. For low-income families there are different
areas in the city where an individual could either rent a property or purchase
one. This area of the city has great accessibility to many resources, although accessibility
is great, the northeastern part of the city has many factors that drive real
estate prices down. In the northeast part of the city there is an apartment
complex, Meadowbrook Apartments, that has very affordable units for low-income
families. An individual can rent an apartment here for as low as $550 a month (Rodriguez,
Lisa). The majority of the people who live here are low-income families. The
surrounding area has businesses like Town & Country Supermarket; prices
here are competitive and cater to lower-income individuals who are looking to
put more food on their family’s table. Other businesses like small mom and pop
shops provide the area with products for everyday living. Camacho Park is a
community park that is moments away from Meadowbrook Apartments. Jefferson
Elementary School is the nearest elementary school and General Grant Middle
School is the nearest junior high school. Both schools have received government
grants to build new facilities for staff and Grant Middle School has a new gym.
Both schools have an average of 60% of students that are economically
disadvantaged (ed-data). Income is greatly related to the amount of crime in an
area, in Reedley crime is balanced out evenly in all areas of the city. This
area in particular, there has been many gang related crimes that have gone
unreported due to retaliation if anyone says anything to the police (Campos,
Julio). Property values in this area of Reedley are lower than most in the
city. Guarantee.com has many listing of home in the area that go for less than $115k.
Some of these homes were built in the early 2000’s and they are priced less
than $135k. Other homes were built in the 1960’s and go for either the same
price or a little less. It is possible that the area in which these properties
are in have their value affected by the environment around them. Even though property
values are down in this area, there is opportunity for an entrepreneur to
invest their money in a home or apartment complex. This is a good area to
purchase an investment property at a low cost to lease out to renters or purchase
a commercial property to start a business at a low start up cost.
In Reedley there are
different areas where the middle class live in. The east side of Reedley has
some homes that just went up in the early 2000’s. These homes prices range from
$250k to $145k (Zillow.com). The south side has had growth with some new
development with home prices that range from $190k to $125k (Zillow.com).
Another newer development is in the north part of Reedley, here home prices
range from $225k to $185k (Zillow.com). Some of these areas do not have great
accessibility such as the east and south developments. Home prices are still
higher than the northeast part of Reedley where accessibility to resources is
much better. What drives the prices of these homes up is the value of the homes
around them. Since these developments are newer the neighborhoods have not been
negatively impacted by too many foreclosures or other events that might drop
the price of the home. The closest school for the north side of Reedley is TL
Reed. This school has a waiting list because it attracts many people to its new
facilities and extra curriculum for after school students. On the east side,
the closest school to these homes is Silas Bartsch School. This new school will
be going into its fifth school year in the fall of 2012. These areas of Reedley
have low crime rates and very little gang activity. They are closely located to
the troubled areas but have little affect from them. The homes in these areas
of Reedley have been able to hold their value better than most areas in the
city due to these areas being newer developments. When there are neighborhoods with
problems like foreclosures, it is possible that the value of the homes in the
area will drop because these foreclosures will sell at a lower price than what
they are valued at. When homes are sold at a lower price it makes the value of
other homes around the area drop, which might be the case in some of the least
valued neighborhoods in Reedley. These homes have not been around long enough
for so many negative events to happen to them.
When speaking of value, several
of the most valuable homes in Reedley are on the west side of town, right next
to the river. The lowest price for a home in this area is about $225k
(Zillow.com); those who are in the upper class of society live comfortably in
this area. The size of these homes will range from 1,800 square feet to 3,500
square feet. Some of these homes were built in the early 1990’s and many more
continue to be built in empty lots as the years go by. Those who live in this
part of town hold careers such as doctors, physicians, successful business
owners, tenured teachers, and farm owners. Very little crime is in this area;
the individuals living here are secluded and are very familiar with each other
and what is going on in their neighborhoods. Any strange car rolling around the
block can be suspicious and police will not hesitate to pull over someone to
check out what they are doing in the neighborhood. This part of town has great
accessibility to the main roads in the city, Manning and G Street. There is a
private school, Immanuel, located about 5 minutes away from the area. This
school holds many high standards and practice religion in their school
curriculum. This part of Reedley has some of the best neighborhoods where an
individual can live in peace knowing that the value of their home will not be
greatly affected by many foreclosures. About every ten years there is a newer
and bigger home built in this area, this helps keep the value of the homes in
the neighborhood higher than most homes in Reedley.
In conclusion, Reedley
California is an overall a great small city. The real estate market here is
comparable to just about any other reasonable market in the Central Valley. Accessibility
does play a big roll in what the property value will be, but there are also
many other factors that need to be taken into consideration. Reedley has a
range of homes that have both good accessibility and not so great
accessibility. All these homes range in property value that is greatly
determined by the surrounding neighborhoods. Homes that are priced higher are
located around other homes that have a high price and are also located in areas
where families can send their children to a good school and still get to work
easily by taking the main roads. Lower priced homes are located in the same
neighborhoods where there are other lower priced homes and have great
accessibility to public schools and local businesses, their value is greatly
affected by the amount of foreclosures in the same neighborhood. There will
always be opportunity to invest in property whatever the price of a home might
be. People just need to be aware of where the home is located so that they are
paying the correct price for what they are getting.
References
http://www.zillow.com/
Campos, Julio.
"Life In Reedley." Personal interview. 01 Apr. 2012.
"Community History." Welcome
to Reedley. City of Reedley. Web. 02 Apr. 2012.
<http://www.reedley.com/community-history.html>.
Diaz,
Julian, and J. Andrew. Hansz. Real Estate Analysis: Environments and
Activities. Dubuque, IA: Kendall Hunt Pub. 2010. Print.
"Ed-Data." Pages.
Educational Data Partnership. Web. 01 Apr. 2012.
<http://www.ed-data.k12.ca.us/Pages/Home.aspx>.
"Fresno Clovis Homes, Fresno Real
Estate, Guarantee Real Estate." Fresno Clovis Homes, Fresno Real
Estate, Guarantee Real Estate. Guarantee. Web. 04 Apr. 2012.
<http://www.guarantee.com/>.
Rodriguez,
Lisa. "Meadowbrook Apartments." Telephone interview. 28
Mar. 2012.
"Welcome to Reedley." Welcome
to Reedley. City of Reedley. Web. 02 Apr. 2012.
<http://www.reedley.com/mission-statement.html>.
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