6 Key Signs Your Home May Plummet in Value in 2024
Both homeowners and real estate investors buy houses hoping — and perhaps even expecting — that their properties will appreciate over time.
Many do — but not all.
Check Out: Avoid Buying a Home in These 10 Florida Cities
Learn More: 6 Genius Things All Wealthy People Do With Their Money
According to an Axios/Redfin report, more than 3% of homes sold at a loss in 2023, up from 2.4% the year before. The median loss was around $40,000.
San Francisco — where one in seven owners lost money — took the biggest hit, with a median loss of $125,000, but New York, Cleveland, Chicago and Detroit all suffered depreciation rates above 6%, too.
Clearly, homeownership does not guarantee wealth building, but the good news is that a few telltale warning signs can help you predict whether your house might be primed to hemorrhage value in 2024.
“Listen, the housing market can be tricky to predict, but there are definitely some red flags to watch out for if you’re concerned about your home’s value,” said real estate investor Itay Simchi, founder of Proven House Buyers. “While a few isolated issues may not be a deal-breaker, a combination of these factors can certainly dampen buyer enthusiasm and potentially lead to a decline in price.”
If you notice any of these cautionary signs, you might consider cutting your losses and selling while you still can.
Your Neighborhood Is Showing Signs of Decline
If you leave your house every morning and feel like your once-pleasant neighborhood is going to the dogs, your home value might begin to plummet with your quality of life.
“Is your street becoming increasingly neglected?” Simchi said. “Are businesses closing down and storefronts sitting vacant? This can create a perception of a less desirable environment, making it harder to attract buyers willing to pay top dollar.”
According to iBuyer, other signs include loose or aggressive animals, garbage and litter, excessive noise and unruly behavior.
Discover More: 5 Types of Homes That Will Plummet in Value in 2024
Crime Is on the Rise
There are many signs of neighborhood health, but none are more immediate, more impactful or more consequential than the crime rate — and when crime rates rise, home prices fall.
“A rise in crime in your area can be a major deterrent for buyers,” Simchi said. “It’s important to stay informed about local crime statistics and take steps to ensure your own safety and security, but be aware that a perceived lack of safety can affect your home’s marketability.”
Surrounding Properties Are Deteriorating
When estimating a home’s value, real estate pros look at “comps” — recorded prices of similar properties on the market. When the values of those comparable homes fall, yours can get washed away in the tide even if you do everything right — and it takes only one derelict property to ruin a block.
“If neighboring houses are falling into disrepair, with overgrown lawns, unaddressed maintenance issues or even code violations, it reflects poorly on your entire street and can bring down property values collectively,” Simchi said.
The Local School System Is Failing
Parents pay a premium to live in good school districts; and, when a neighborhood loses that key amenity, buyer demand — and prices — can fall quickly.
“A decline in school ratings can be a significant concern for families, especially those with young children,” Simchi said. “This can make your home less appealing to potential buyers seeking a good educational environment for their kids.”
Your Town Is Becoming Overdeveloped
Population loss is a classic sign of a neighborhood in decline — but too many newcomers arriving too quickly can be just as bad for home values.
“While some development can bring positive change, an influx of new construction, especially if it’s poorly planned or disrupts the character of the neighborhood, can lead to concerns about traffic congestion, noise pollution, and a loss of community feel, potentially impacting property values,” Simchi said.
Your Own Unimpressive Maintenance and Upkeep Standards
Many things affect property values that homeowners can’t control, but sometimes they have only themselves to blame for property depreciation.
“Let’s face it, curb appeal matters,” Simchi said. “If your home’s exterior shows signs of neglect, like peeling paint, a damaged roof or overgrown landscaping, it creates a negative first impression and can signal potential buyers that significant repairs may be needed, impacting their offer price.”
Simchi stresses that these factors do not represent an exhaustive list and can vary considerably depending on your location and local market conditions.
“But if you’re concerned about your home’s value, it’s definitely worth keeping an eye on these trends and taking proactive steps to address any areas within your control, like keeping up with maintenance or addressing curb appeal issues,” he said. “Consulting with a local real estate agent familiar with your area can also provide valuable insights and guidance.”
More From GOBankingRates
Average Cost of Groceries Per Month: How Much Should You Be Spending?
7 Things to Do With Your Savings in 2024 to Grow Your Wealth
4 Reasons You Should Be Getting Your Paycheck Early, According to An Expert
This article originally appeared on GOBankingRates.com: 6 Key Signs Your Home May Plummet in Value in 2024