On spending more for a "safe" home

[ModernIncantations]

I need your help convincing my wife and her family to save money on our next home!

Their logic goes like this:

"One should spend more to live in a good and safe neighborhood for one's family to grow up in"

When I try to narrow down what makes a place good and safe I usually get abstract answers, or claims that it just has to be seen. The only concrete evidence so far is that people's yards are well manicured.

Of course, the real crime statistics are immaterial in this argument. I think this is just an unfounded fear of working class neighborhoods and a disguised desire for a bigger, more expensive house, but I love my wife and her family and I need all of us to be happy with where we live.

How can I convince them that a $100,000 house is no less safe than a $200,000 house without sounding like a cheapskate dad who is willing to endanger his family to save a buck?

[WerKater]

Well, their logic is already illogical (as you also implicitly mentioned). I corrected it:

One should spend more to live in a good and safe neighborhood for one's family to grow up in

This is how you have to frame the discussion. Make sure you know as much data as possible. When you look for houses in various neighbourhoods, make sure that you know the crime statistics (if they actually exist, otherwise, you are screwed ;) ). Then order the neighbourhoods/houses by safety. If you actually find that the more expensive ones are safer you might not be able to win the discussion. If not, try to select houses in safe but inexpensive neighbourhoods. Maybe they will accept that.

[Roots&Wings]

Of course, the real crime statistics are immaterial in this argument.

Unsure I follow this? In my area, crime stats and the residences of registered sex offenders seem to correlate with a 'good' or 'safe' neighborhood. Well maintained yards/homes are also a good sign in my book.

If you can't find crime data for some reason, you could always check the registered sex offenders database (I use the city-data site, which displays results on a map view).

[ketchup]

I just bought a house in a "safe" area, but not necessarily a super "nice" area.  The schools here are relatively lousy (not horrible, but not great), which drags down values as it makes it less desirable for families.  My girlfriend and I have no kids (or plans for them), and it seems as if everyone else on our new street is at least 70, so none of us are too torn up by less than great schools.  And yes, the lawns look just fine with hints of pretension here and there.

Exploit other people's desires by firmly deciding what you don't give a damn about that others do.  Saves tens to hundreds thousands on housing.

[Another Reader]

Exploit other people's desires by firmly deciding what you don't give a damn about that others do.  Saves tens to hundreds thousands on housing.

Until you go to sell the house.  Poor quality schools will be a drag on both selling price and time on the market.

I would go look at open houses in a variety of neighborhoods with your wife for a few weekends and discuss what you see.  Her real desires and fears will come out in the conversations.  Leave the in-laws at home, as this is a decision for the two of you to make.

[I'm a red panda]

Having moved from an inexpensive neighborhood to a more expensive one, I think there is definitely value to neighborhood.

I would bet by crime statistics my old neighborhood was only a little worse than my new one will prove to be over time (although with only a 3 year history, there have been no reported crimes), the old one had a slightly higher crime rate because I was so close to a HUD development, and IT had lots of petty crime within it. But I never felt unsafe.  I was near a police station though- about 2 miles.

However, the level of community in my new neighborhood is practically priceless.  But if I could find a less expensive neighborhood like that, there is no actual value in the bigger house for me.

But know the name of everyone who lives on my street, seeing all the kids play together, having fire pits with the neighbors- these things are worth paying for, IMO.

NONE of this happened in my old neighborhood. I would wave when walking the street and people would glare at me, I would bake cookies for people who just moved in and never see them again.

It may not be caused by house price; but this was my experience, and the experience of many people who "moved up" to our new neighborhood.


So if the house is not a stretch to afford it, I totally understand the reasoning.

[historienne]

FWIW, research suggests that white people tend to misestimate the safety of neighborhoods by basing their estimates on racial composition rather than more meaningful factors. We overestimate the safety of high-crime white neighborhoods, and underestimate the safety of low-crime black neighborhoods (the study I'm thinking of did not explore neighborhoods that were predominantly Latino, Asian, etc). 

The effect is probably more general - class markers also affect perceptions of safety, and I suspect there is a similar over/underestimate effect.  Safety is desirable, but if you make your choices based on actual statistics rather than a nebulous perception, you can probably find overlooked neighborhoods that are actually very safe.

(On a separate note - I don't get the argument that you should pay more to be in a 'nice' neighborhood because it protects real estate values.  That's already priced in.  You don't want to be in a *declining* neighborhood, and it's good to be in an *appreciating* neighborhood, although it can be difficult to predict those kinds of changes.  But if prices are generally stable, you are going to come out better financially by buying low and selling low rather than buying high and selling high.

[ketchup]

Exploit other people's desires by firmly deciding what you don't give a damn about that others do.  Saves tens to hundreds thousands on housing.

Until you go to sell the house.  Poor quality schools will be a drag on both selling price and time on the market.

I can definitely understand what you're getting at, but this particular area is still reasonably active.  The time-on-market around here isn't totally insane where every house is gone in a matter of days, but it's still fast enough that I'm not put off by it.  We missed a bunch of good opportunities when house shopping here because we were too late.

And besides, I'd rather spend around $100k on a reasonable house than buy in the neighborhood near where I work, where everything is ludicrously inflated and small houses start at $400k (with the stupid 3000 square foot McMansions well over half a mil). 

[humbleMouse]

I think you should speak with somebody who has lived in the city you are talking about for a long time.  Crime stats won't really tell you much.  I have been in Minneapolis for a long time and people's perception of what a "safe" neighborhood is in Minneapolis is usually incorrect. 

In Minneapolis there are a few places that I would not live if I had a family, but they are pretty small areas easily avoidable.  Still lots of places to buy cheap housing. 

Anyways, long way of saying that you really need to speak with a native of whatever city/neighborhoods you are talking about. 

[Another Reader]

Marginal neighborhoods are the first to drop when values decline and the last to recover.  That's because people that want to be in better areas can afford those better areas when values (prices) drop and are not forced to compromise.

Do the open house tours before forming a final opinion.  Neighborhood is a deal breaker for me, even for my rentals.  It may be for her as well.

[Spork]

Also... when you look at the crime stats, make sure you know what they are representing.  Make sure you know the boundaries of the area being measured and what all is in it.  They can often be misleading.

I remember a "high crime" neighborhood in the DFW area where a bunch of rich folk were able to bulldoze the neighborhood via eminent domain.  They built a big ass football stadium.  It turns out if you looked at the stats, all the crime was not from the "bad neighborhood" ... it was in the parking lot of an already existing baseball stadium across the street.

[dandarc]

Also... when you look at the crime stats, make sure you know what they are representing.  Make sure you know the boundaries of the area being measured and what all is in it.  They can often be misleading.

I remember a "high crime" neighborhood in the DFW area where a bunch of rich folk were able to bulldoze the neighborhood via eminent domain.  They built a big ass football stadium.  It turns out if you looked at the stats, all the crime was not from the "bad neighborhood" ... it was in the parking lot of an already existing baseball stadium across the street.

+1 - the crime stats for the one-mile radius our house could look alarmingly high.  Until you look at the details and see it is almost all happening at the very high-traffic commercial areas nearby.  Lots of drunk idiots being drunk idiots at bars types of stuff.  Nice to be close to these commercial areas too (maybe not the bars specifically, but lots of other types of businesses nearby too).

[Sid Hoffman]

Until you go to sell the house.  Poor quality schools will be a drag on both selling price and time on the market.

The longer I've lived on my own, bought/sold homes, and followed rents and housing values, the more that I've seen that the quality of schools tends to be an excellent barometer for how good of an investment a home is.  I'd be happy to spend a little more up front to get a home that seems to be an appreciating area with great schools, as I will get that money out of my home if and when I go to sell in the future or turn the home into a rental and buy a second home.  More valuable areas with better schools will command higher rents, too.

[Schaefer Light]

Having moved from an inexpensive neighborhood to a more expensive one, I think there is definitely value to neighborhood.

I would bet by crime statistics my old neighborhood was only a little worse than my new one will prove to be over time (although with only a 3 year history, there have been no reported crimes), the old one had a slightly higher crime rate because I was so close to a HUD development, and IT had lots of petty crime within it. But I never felt unsafe.  I was near a police station though- about 2 miles.

However, the level of community in my new neighborhood is practically priceless.  But if I could find a less expensive neighborhood like that, there is no actual value in the bigger house for me.

But know the name of everyone who lives on my street, seeing all the kids play together, having fire pits with the neighbors- these things are worth paying for, IMO.

NONE of this happened in my old neighborhood. I would wave when walking the street and people would glare at me, I would bake cookies for people who just moved in and never see them again.

It may not be caused by house price; but this was my experience, and the experience of many people who "moved up" to our new neighborhood.


So if the house is not a stretch to afford it, I totally understand the reasoning.

I know exactly where you're coming from.  I'm in a neighborhood that sounds a lot like your old one.  We don't really know or talk to any of our neighbors.  This isn't helped by the fact that some of our neighbors don't speak English.  I really want to move to a golf course community (where there's a built-in common interest amongst a lot of the inhabitants), but I'm not sure I'm willing to spend what it would take to buy a home there.

[Bob W]

I can pretty much end this argument --

Tell you read that one should never spend more on a home than they have in liquid assets.   That is my rule at least and it is a pretty damn good rule.

I assume you will not do this --- because let's face it  --- your set is kept in a box in the drawer.

So the next best thing is to look up crime stats for particular areas.   Drill down and find stats on the cheaper areas you lean towards and compare them to the more expensive.    Be sure to look at type of crime.   Smoking weed is not a real crime.  Rapes,  murders,  armed robberies and burglaries are.

She is probably right on this by the way.   

If she want to use the crime rate as the primary metric (me thinks it is secondary) then you can google up safest places to live.   It won't be in the USA.   I hear Canada is very nice if you like cold weather. 

Additional steps:

Have a home and care security system

Be armed with a conceal and carry permit

Carry mace, panic buttons

Take self defense training

In my experience,  if you are living in a big city area,  you will eventually be involved in a significant crime.   Don't become a statistic. 

[MsPeacock]

As the says going "location, location, location.' Little else matters in real estate. As I see you it can change anything (almost) about a house, but you cant' change the neighborhood or community. And because of that many people are willing to pay some premium towards safety, walkability, school quality, etc. And it does effect the value of your house to have neighbors that are keeping up or not keeping up their property. If the house is an investment, it is worth considering how the value will be impacted by factors - even factors that you don't consider important (e.g. school quality, even if you don't have children in school).