When Dustin Knoop, 34, and his wife first began scoping out apartments three years ago in some of the more established neighborhoods in Brooklyn, they were surprised at how little their budget of $500,000 got them.
So when their realtor suggested that they check out a new building in the under-the-radar area of East Williamsburg, they thought: Why not?
The neighborhood wasn’t as hopping as others they’d checked out, and it was a farther commute from Manhattan—but they were immediately sold when they saw the apartment. The one-bedroom had a large terrace and city views, was more spacious than anything they’d previously viewed, and it came in under budget.
Plus, after spotting a number of under-construction buildings nearby, they figured the purchase would also serve as a smart investment. “We were on the perimeter of the new developments,” Knoop says. “But we had a strong notion that this neighborhood was going to continue to get better.”
They were right: Between 2013 and 2014 the median home value in their area jumped more than 31%, according to stats from Zillow.com.
Getting a lot of bang for your buck is one of the benefits of buying in a so-called transitional neighborhood, and for the Knoops, settling in East Williamsburg was a no-brainer.
But that doesn’t mean the decision will come easily for everyone. After all, buying a home is as much an emotional investment as it is a monetary one. “You can’t simply look at a neighborhood in a financial light,” explains Greg McHale, a realtor with Urban Compass. “You also need to really believe in it as a place to live—to hang your hat and to grow.”
To find the answers, we tapped three real-estate pros from across the country to clue us in on how to sniff out an affordable neighborhood on the rise.