How To Assess Crime Rate When Investing In Property

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    property crime rate

    Crime rate is one of the biggest concern when you either invest in property or are in process of short listing an area for you to live.

    Fact is:

    Every area that you choose, whether you like it nor not, always has two sides to it.

    There are good postcodes where it’s more secure to live or invest, and there are not so good postcodes where it’s a bit insecure comparatively to invest.

    i.e.

    No investment area is an exception and every area that you plan to invest has to be analysed for crime rate within the area.

    This post is going to outline some best practises on how to analyse crime when you start your property investment journey.

    But:

    Before you start defining a method to assess crime rate, you probably should set some principles on how you will evolve crime rate assessment as a repeatable system that you can use.

    Crime Rate Assessment Principles

    The three simple principles that we have setup ourselves at Limitless Monks are:

      1. Evolve from online research your own criteria to assess crime (your standards)
      2. Investigate the detail than the numbers that the crime report shows
      3. Validate the area yourself all the time in-person

    The general practice within the investor community is to rely on websites like streetcheck.co.uk and get a high level view of crime rate within the area or postcode.

    But:

    If you just look at numbers provided by the website, you probably will not get a realistic picture of crime rate within an area.

    The devil is in the detail and unless you actually go to the area and walk the area yourself and speak to people, you cannot validate or justify the numbers provided in the website.

    So:

    How do you research crime rate for an investment area at a postcode level.

    Let me classify this into two stages

      1. Online research
      2. Onsite research

    Online Research For Crime Rate Within Property Investment

    The Basic Research

    Basic research is the first level of analysis where you simply enter a postcode into an area analysis websites like streetcheck.co.uk or checkmystreet.co.uk.

    These websites will give you the comfort/discomfort feel the very moment you look at the visual numbers that are on display when you enter a postcode.

    For example:

    Here is a screenshot of numbers of crime in one of the postcodes in my investment area and it gives me a comfort feel. The numbers don’t look alarming as such.

    assess crime rate

    However:

    Here is another postcode within the nearby investment area that gives me discomfort as an investor.

    assess crime rate

    Just list these high level numbers for the postcode you want to assess crime rate for in an excel.

    Trick though is:

    You can list multiple postcodes in one go and check these numbers for all the postcodes in one go.

    This is exactly what most investors do and arrive at an idea of how the crime rate is within the area.

    However:

    These numbers are a bit misleading and you need to understand few facts about these numbers.

    Perceptual Analysis

    This is where you will have to dig a little deeper into the numbers you have just listed because those numbers really doesn’t matter when you see them in the default view.

    Here are few facts about what you are shown.

    First:

    Crime report on streetcheck website gives numbers from postcode you enter to half a mile radius around it in its default view.

    i.e.

    The street you look at may not have any crimes in practice but still report 50+ crimes which is a little misleading.

    Click the map and expand the map to just your street and you will know the real numbers.

    For example:

    One of the streets as per below example shows that there is one area where there have been multiple instances of crime.

    Click on the green/amber circles you get within streetcheck website and you will be shown below view where you can see all the crimes in the area and the proximity to the street as well.

    assess crime rate

    Second: Check At-least A Year Of Crime Data

    When you see the default map view within streetcheck website, understand that the crime report with numbers you see is for current month only.

    So:

    Go back to 10 months comparing numbers each month. This gives you indication if this is a one off month with high numbers or has been like that for longer periods.

    You will find this as a dropdown below the map when you searched on your postcode and click on “Crime” menu.

    crimeperiod

    This will validate and tell you something about the area.

    Third: Check Area Parameters

    Now check the employment rates, culture and people tabs within the postcode to form a consensus or speculating reasons why you think crime rate is high or low based on the overview…..

    You forming an opinion is key to equip yourself with enough knowledge before you step in to validate with locals.

    Understand that there is no tab that you can put on numbers to say 20 crimes means safe or 50 means be careful and 75+ means dangerous.

    It’s relative always and depends on the postcode plus what you deem as safe. This puts crime rate analysis as a perceptual and fact based than defining a hard criteria.

    However:

    If you have to compare the stats against something thing then you should compare them against national averages to arrive at a logical conclusion.

    Easier way though is:

    www.police.uk provides a very good summary of crime rate analysis by postcode and also provides a good view into outcome from such incidents reported.

    Example:

    An investment area from police.uk website states following for number of crimes committed per crime type between 2018 and 2019.

    crime numbers

    This may sound little scary given the anti-social and violence are very high in the listed crimes.

    However:

    If you now check the outcome of what happened to most of those crimes “no further action” stands as the biggest outcome.

    crime outcomes

    This suggests that the area is not that bad, however is something that needs to be validated with onsite research before concluding.

    Click here to check above stats on your own if you are interested and possibly check for postcodes you want to invest in too.

    Fourth: Assess The Crime Types In Detail

    Asses the crime types in detail.

    Cast an eye on type of crimes done. Are those petty things like minor shop lifting or bigger types like violence and sexual assaults?

    Violence related crimes you probably are forming an opinion on the personality elements remotely, others may be something else.

    At this point it’s all speculative in your mind to form an opinion on the residents and surrounding area…..

    Fifth: Comparative Research

    You can always compare the crime rates within a defined zone and near by cities.

    For example:

    Below is the comparative view of Wigan where we invest as our investment area.

    crime rate comparison

    You can view more information like above within police uk website and assess for your investment area too.

    Tip: Once you search on postcode in above link, click on “Crime Map” on right hand side bar and then further click on “Compare crime levels with other similar areas” under Related pages on the side bar.

    Additionally:

    Search from crime feedback as a general notes from Zoopla or wider internet sites.

    This should include trend analysis like

    • Lots of properties coming up for sale and staying longer on the market
    • Properties stay longer on the market for longer periods without lettings
    • Too many variations/changes within rents on the same street

    This suggests people are not comfortable renting or buying in the area.

    Must Read: 5 Property Investment Risks And How To Mitigate Them As An Investor

    Onsite Research For Crime Rate Within Property Investment

    At this point you have done enough online research and have formed an idea on what you think is the crime rate within the area and if it is safe to invest within the postcode.

    Now:

    Step into the area and start validating it with onsite research.

    Go to your investment area postcode and look for signs of crime you found online on multiple days.

    Here is the deal:

    Behaviours within the area will be different on a weekday and on a weekend and its essential to have this verified and hence multiple days.

    Here are few best sources to gather information about the safety of postcodes that can help you validate your online research.

    Take A Taxi Ride

    Take a small ride on a taxi and speak to the taxi drivers (best sources) given they drive through the streets on a daily basis, they are a wealth of information.

    Personal experience:

    Be nice to them and they can prove very valuable in terms of providing which areas to live and which ones to avoid completely.

    Convenience Stores Sources

    Walk to the nearest convenience stores and ignite a chat, and my best script is “I am moving to the area to live and want some info on where I can live with a family from safety perspective and places to avoid”.

    A bit of personal touch than chatting about investments.

    This script is best used after you managed to build a bit of rapport with the personnel.

    Search That Soul

    Take a walk up the street multiple times and you will comes across an equally keen soul enquiring about what you want.

    We usually come across someone within 30 minutes to talk to.

    Note:

    It’s a one time job to know about number of streets if you strike someone keen to help you.

    Caution: Please note that there will be few unsafe streets and use your own judgement if you should be visiting the street or not logically.

    Must Read: 8 Questions To Ask Before You Buy A Buy-To-Let Property

    Crime Rate Analysis Reconciliation

    You have done online research and have done the onsite research too.

    Now:

    Its that time to sit back with a wonderful cup of coffee or a pint in a pub and map your online research to your onsite research and rate the area yourself.

    Questions like, what does 20 or 50 incidents in an area mean can only be answered specific to the area and specific to the investment criteria.

    Evolve your rating criteria yourself when you analyse multiple postcodes to develop your system on what those numbers mean over a longer run.

    Must Read: 6 Tips To Find A Builder For Your Property Renovation

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