I’m working on an appraisal right now in an area of the 95815 zip code of Sacramento that has had some crime challenges lately. There have been multiple murders within the neighborhood boundaries over the past year. It’s sad of course to see this type of activity in any area, yet always interesting from a real estate standpoint to research neighborhood happenings and make sure to understand what is going on in the local market. Heavy crime might impact market value, right?
Honestly, I find it kind of earie to google street names in this particular neighborhood and read more about specific murders. There are also online local news videos at my disposal too. On top of that, I can scroll through the Sacramento Police Department’s Twitter account and find at least one tweet that describes a situation that happened very close to the subject property.
If you live in an unincorporated portion of Sacramento County or the City of Rancho Cordova, the Sacramento County Sheriff’s Department has a valuable online crime mapping tool. For reference, I used this tool to do some research near the corner of Watt & Arden in the Arden-Arcade area of Sacramento. I included a snippet of the past 90 days of crime within one mile of this intersection based on the Sheriff’s crime mapping tool. Each icon on the map stands for something, whether vandalism, burglary, assault, etc… Check out this crime map tool and let me know what you think.
How have you seen crime impact a community or real estate? On another note, where do you get your crime information from? Local news? Newspaper? Social media?
Ryan, with the advent of quicker and more readily available data sources (such as the police dept. twitter account) it is easier to find this info. to let you know if crime is an issue in an area. I am sure this is something potential buyers consider when buying a home in this area. Unfortunatly in my market most of the transactions in this type of area are foreclosures. I know thats a tough one your working on. Good luck.
It’s amazing how we can get information nowadays. Gone are the days when the 5pm newscast reigned supreme. Many properties in this area are also REOs. Thanks Tom.
Hi Ryan, Great Question.
I generally try to turn down the assignment. If there’s been a rash of “recent” murders, that market impact isn’t going to filter through the market for possibly months in terms of sold sales. We appraisers need sold sales and pending listings to determine market direction. If this was recent, then the appraiser is taking a gamble valuing that real estate. If the crime has a long history in that area, then the sales are already built into that market. A few times, I’ve found the recent news article and used SnagIt to place that in my appraisals documenting the crime. When I do that, the lenders generally don’t order another appraisal from me in that area because they know I will tell the truth.
Isn’t it weird how in the neighborhood section of an appraisal how we have to be so politically correct and can’t talk about such truths as “high crime area”? Doesn’t the investor in New York buying the paper need to know such? When I can’t be truthful in a report, I generally turn down the assignment!
Good insight, Bill. Thanks for the comment. Crime in this neighborhood is nothing new. It’s had issues for years. Although I’ll sift closely through the dates of the murders. I get why we have to be PC on some levels because judgments about market value certainly should not be based on race or income level. However, it does get silly and way too PC at times. I used to do many BPOs for a local REO broker. When doing one in a very high-crime area, the description was always “the area is known for certain types of activity”. That’s just code for drugs, gangs and prostitution.
I understand. But it’s the demographic make up of a market as to why the values are what they are. In local high crime markets, the predominant values might be $50K whereas the average in Baton Rouge is approx. $196K. Obviously, the “neighborhood dynamics” or “neighborhood demographics” in play are the reason for this $146K difference. I sometimes use these terms in order to be PC. Have a great weekend! Bill