When you buy a new home, you want to make sure the seller is not inflating the price of the home just to scam you. The home price may be equal in comparison to other similar homes in surrounding neighborhoods. But that may not take into account legitimate threats that undermine the true value of the home you are looking to buy. Let's take a look at some of the factors that can lower the value of a new home.
• Legit threat #1 - A nearby landfill. Landfills can hurt the value of a home by anywhere from six to 15 percent. This is particularly true if the landfill is about to be declared a hazardous waste site by the federal government.
• Legit threat #2 – Power plants. Power plants nearby lower the value of a home considerably. In fact, the value of the home can be up to 7 percent lower than similar homes if it is near a power plant.
• Legit threat #3 – Sex offenders. Nobody wants to live near a sex offender. Therefore, when a registered sex offender moves into a neighborhood, all of the home values in that neighborhood suddenly drop. You can call up the local police department and ask them directly if there is a sex offender living nearby.
• Legit threat #4 – Deadbeat neighbors. If you are looking into buying a town home or a condo, the real value of the home can be hurt if neighbors don't pay their maintenance fees. This makes it harder for the neighborhood association to keep up the maintenance of the community that keeps up the value of the condos or town homes.
• Legit threat #5 – Neighbors in foreclosure. This is a common problem these days. Every time someone in neighborhood goes into foreclosure, it lowers the value of the other homes in the community. Foreclosure information is a public record you can check to make sure this problem won't happen to you.
• Legit threat #6 – Landscaping problems. If people in the neighborhood aren't keeping up with their landscaping, that hurts the value of other homes in the neighborhood. Take a drive around the surrounding streets and see what people's front lawns look like.
• Legit threat #7 – School closing. The quality of the local school system has a big impact on property values. And with the bad economy, many towns are closing local schools. When that happens, home values plummet. You can contact the local school board and ask them directly if they have any plans to close some of the local schools.
Be aware of all these legit threats to a home's value before you place an offer – so you don't end up paying more money than you should for your new home.