One of the first steps in buying a home is learning to recognize the signs of a bad neighborhood. A bad neighborhood, or one that is in decline, will limit your home’s appreciation of value, increase your chances of becoming a victim of crime, and affect your entire way of life.

Some bad neighborhood signs are obviously visible, while others are less so.

Visible signs of a bad neighborhood.

Obvious visible signs of a bad neighborhood include broken windows, vacant houses, graffiti, cluttered yards, abandoned cars, peeling paint, or other signs that homes are not being properly maintained.

A less obvious but still visible sign is people walking in the neighborhood. Check out the area on a warm afternoon or over the weekend. Are there people walking their dogs or taking a walk with their children? If so, that means the area is likely low crime.

Look around at businesses in the area. Do you see empty storefronts or office buildings? Do the businesses in the area seem to be doing well, or are they the type of businesses that gravitate toward low-rent areas? Retail business owners keep their fingers on the pulse of a neighborhood. If successful business owners have moved elsewhere, perhaps you should also consider a different area.

Pay attention to the number of police cars you see. Police departments assign their officers where they are needed most. Unless the area you’re looking at is very upscale, the frequent police patrols mean the area is likely to be more crime prone than others.

Less visible signs of a bad neighborhood.

If the area you are looking at verifies the above points, that does not mean that the area is not prone to less visible problems.

One telltale sign of a deteriorating neighborhood is property values ​​that are stagnant or not keeping up with values ​​in other parts of the city or county. Do some research at the library or online for newspaper articles to see if homes in the area are appreciating at the same rate as homes in other parts of the city or county.

Ask neighborhood residents which houses are owner-occupied and which have absentee owners. Absentee landlords don’t always rate their tenants well, and bad tenants can ruin a neighborhood. Look around the area to see how many apartment buildings there are. Apartment dwellers are often transient, have little or no interest in a neighborhood, and can be a source of trouble.

If possible, try to find out how many police officers live in the area. Police officers know where criminals work and don’t like their families living in those areas.

Many cities require police officers and other city employees to live within the city. Milwaukee, Wisconsin is one of those cities. The southwestern part of Milwaukee has more police officers living there than in any other part of the city. That part of the city also has the lowest crime rate. That’s not a coincidence.

Consider the entire city or county.

When considering buying a home, look at population and business patterns. Is the population increasing or decreasing? If it is declining, where are people moving to and why?

Are major businesses moving to the city or county, or have they left?

These two considerations, population change and business patterns, are excellent indicators of the future of the area.

Even if residents leave to move to bigger homes in the suburbs, and businesses follow to stay close to their employees, that doesn’t bode well for the future. When they leave, the city’s or county’s tax base is reduced, leading to cutbacks in services, increased unemployment, and more problems.

If residents and businesses are leaving, the area is facing problems you don’t want to be a part of.

Resist shopping on an “island.”

Even if the neighborhood you’re looking at seems fine, you should look at neighborhoods ten to twenty blocks away. It may well be that the neighborhood you are looking at is an island surrounded by bad neighborhoods. Sometimes these “islands” remain intact. However, more often than not, the island is eventually engulfed by the surrounding bad neighborhoods.

For most people, their home is their most valuable asset. Buying in a bad neighborhood puts that asset at risk. If you are financially constrained, consider buying a smaller home in a better area. As the home appreciates, you’ll have the equity to trade for the home you’ve always wanted.