Buying Home Near Railroad Tracks

Resale Value of Buying Home Near Railroad Tracks

Gustan Cho Associates are mortgage brokers licensed in 48 states

This article will discuss buying home near railroad tracks and its negative impact on appreciation and resale value. No doubt buying home near railroad tracks has a lower market price compared to a comparable home. During a booming housing market, when there is a shortage of homes, some homebuyers may only have the choice of buying a home near railroad tracks.

Buying home near railroad tracks is a long-term commitment. Keep in mind homebuyers can get a substantially reduced price buying home near railroad tracks. 

You will hear noise from the railroad tracks daily and even in the middle of the night. You will also not get the home’s fair market value when you sell it. For many homebuyers who are getting impatient with the inventory shortage and homes selling substantially higher than the listed price, buying home near railroad tracks may seem like a great deal. Buying a home near railroad tracks may or may not be a good deal, depending on how much discount you get and how the real estate market will be when you sell your home.

Resale Value of Buying Home Near Railroad Tracks

Is Buying Home Near Railroad Tracks a Bargain or a Bad Investment?

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Homes next to or near railroad tracks often sell at a discount. The discount on the market value depends on how close to the railroad tracks the house sits. Buying homes near railroad tracks must be thoroughly thought over with your family. This can be a non-issue with some families, but not for other families. Some home shoppers often run into huge price markdowns on homes next to or near railroad tracks.

It is very tempting to put an offer on buying a home near railroad tracks when comparable homes are selling over the list price with multiple bidders.

Buying home near railroad tracks seems like a no-brainer and a bargain. Is it a bargain? Or is it a bad financial decision? If things seem too good to be true, it normally is. The benefits may include getting a home below market value. However, the negative to getting a home below market value is the resale value. How long will it take for the home to sell? How loud will the noise from the train be?

Resale Value of Buying Home Near Railroad Tracks

Do Railroad Tracks Reduce Home Values, and If So, How Much?

One frequently asked question at Gustan Cho Associates is whether train tracks reduce home value. Statistics show that homes located within 1,000 feet of railroad tracks reduced the value of a home by an average of 10%, give or take 3%. This reduction in value is for an average 1,800-square-foot home. So, is buying a home near the railroad tracks a good deal or a bad investment?

There are many frequently asked questions by our viewers and clients about buying home near railroad tracks. Buyers of homes near railroad tracks should expect some inconvenience.

How tolerant you and your family can be with the drawbacks is to be determined. The loud noise is negative. One important question you need to answer is how often and how long you would have to tolerate the noise of railroad trains blaring. Depending on the age and construction type of the home, older-built homes can be affected by vibrations from the railroad tracks when trains are in transit. 

What Factors Determine Value of Homes Near Rail Road Tracks

It is important to note that reduced market value and an increased share of homeowners willing to sell homes near train tracks do not necessarily mean that homes near the tracks should be avoided at all costs. Michael Gracz of Gustan Cho Associates used to live in a house near railroad tracks. Here is what Mike said about living in a home near railroad tracks:

I have lived in a home near railroad tracks for almost ten years. When I first moved in, it was difficult to adapt to the noise. However, after years living in the home, my family and I got used to the load noise of the train.

The home’s location is crucial to its future worth. A home with scenic views or access to quality amenities may remain highly valuable. Having attractive and unique features can offset the decreased value due to noise pollution and safety concerns near the railroad tracks.

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Is Living Next To Railroad Tracks Noisy?

Whether living near train tracks is noisy depends on whether the individual or family lives near railroad tracks. Here is what Alex Carlucci of Gustan Cho Associates said about living next to train tracks. Alex Carlucci lived next to the railroad tracks for over a decade until they sold their home in New York and moved to Las Vegas, Nevada. Here is what Alex said:

How will the resale value turn out when selling the home? How much of a nuisance will live in a home near railroad tracks affect you and your family? How loud are the trains? 

However, the million-dollar question is, am I getting a deal or a potential financial disaster when I sell the home?  Remember that just because you are getting a reduced price, buying home near railroad tracks, you are also taking a risk on the resale value. It will sell below market value due to its location near railroad tracks. This blog will cover the potential loss a homeowner can take on the resale value of buying a home near railroad tracks.

Resale Value of Buying Home Near Railroad Tracks

How Close Is Too Close When Living Near Train Tracks?

A home’s proximity to railroad tracks is a matter of personal preference. However, experts recommend homes be at least 500 feet away from tracks. It’s also recommended that homes be located at least 1,000 feet away from junctions where trains switch tracks. Ethel Matthews of Gustan Cho Associates is a dually licensed realtor and loan officer and has sold her fair share of homes near railroad tracks. Ethel shares the following:

There are homes blocks aways from railroad tracks, where the noise of the trains is loud. Yet, there are also homes right behind railroad tracks that the noise level is louder.

Homebuyers buying home near railroad tracks must consider how close it is to living near train tracks. Living too close to railroad tracks can be dangerous, especially if you have small children or pets. Children and pets are often curious and might venture too close to tracks, putting themselves in harm’s way. Additionally, if a derailment or accident occurs, those living close to the tracks may be at a greater risk.

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Renting Versus Owning Near Train Tracks

Buying Home Near Railroad Tracks

One of the greatest benefits of being a renter versus a homeowner is that you can not renew your lease and move if you do not like the area. Or you can give a 30-day notice, vacate your rental, and get another place to live. Ethel Matthews is an experienced real estate agent in South Carolina. Ethel Matthews is a buyer’s and the seller’s agent and shared the following:

Many of my homebuyers buying home near railroad tracks initially complain about the loud noise of the train. Most get adapted to the noise and do not seem to mind. Very few families regret buying home near railroad tracks.

If you do not like your neighbors, you can always move. If you do not like your neighborhood, you do not have to live there and find another rental. You can move if you are backing into railroad tracks and the noise bothers you. However, that is not the case being a homeowner. It is not easy to move for homeowners. Selling your home and buying another takes time, patience, and many costs.

Rising Home Prices and Home Shortage

Rising Home Prices with very low inventory are creating more and more demand for housing. Mortgage rates have been the highest since the 2008 housing and mortgage collapse. These higher mortgage rates have not slowed down home demand. The mortgage industry has become very lax, and new products have been created and launched.

Resale Value of Buying Home Near Railroad Tracks

Self-Employed Mortgage Loans With No Tax-Returns Required

Self-employed borrowers can now qualify for mortgages with no income tax returns. Jumbo Mortgages is no longer for perfect credit score borrowers with a 25% down payment. Homebuyers no longer have to wait two to four years after bankruptcy or foreclosure with non-QM loans. Gustan Cho Associates launched the following mortgage programs in 2024.

  • Non-QM Loans
  • Bank Statement Loans for self-employed borrowers
  • 90% LTV Jumbo Loans
  • Asset Depletion Loan Programs
  • Condotel and Non-Warrantable Condominium Financing

Low Home Inventory Crisis In The United States

With new loan programs available to home buyers and the great economy, buyers are shopping for homes. However, many are getting frustrated with the lack of inventory. Builders are selling homes before breaking ground and obtaining a building permit. There are many instances where builders can purchase lots to build homes near railroad tracks at a big discount where they cannot pass it up.  Builders are scooping land at premium prices. Many builders buy land in less-than-desirable locations such as by railroad tracks, facing busy roads, and homes near apartment communities and commercial zones. Buying Home Near Railroad Tracks is becoming increasingly common for home buyers.

Resale Value of Buying Home Near Railroad Tracks

Buying Home Near Railroad Tracks Are Much Cheaper

Home shoppers have a certain amount of budget when buying homes. In many instances, shoppers are used to comparable homes they shop for. Suddenly, they run into a much more luxurious home but prices much lower. What is the catch? What is wrong with it? Is it a misprint? Nothing in this world is for free. Buying Home Near Railroad Tracks is much cheaper. In general, Buying Home Near Railroad Tracks is substantially much more affordable. Buying Home Near Railroad Tracks also has its negatives. The biggest drawback with Homes Near Railroad Tracks is depressed property values. Resale Value can be an issue. Also, Homes Near Railroad Tracks can take substantially longer to sell.

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Is Buying Home Near Railroad Tracks Considered Bad Investments

In general, Homes Near Railroad Tracks have their drawbacks. Not too many people like to live near railroad tracks. One of the biggest financial drawbacks of buying home near railroad tracks is lower property values. Most homeowners do not want to live near traffic. Buying homes near busy roads is a major drawback. Buying Home Near Railroad Tracks is even worse.

Appreciation of homes near railroad tracks can be dwarfed. Any property half a mile or near railroad tracks will tend to see a slower appreciation and take much longer to sell.

Say that you got a lifetime deal in buying home near railroad tracks, and you are not worried about the resale value of the bargain you got. There are other issues you need to consider. Owing a home near railroad tracks will also come with putting up with the noise levels. Besides the rumble and tumble of the tracks, trains have powerful horns.

Resale Value of Buying Home Near Railroad Tracks

Is it Unhealthy to Live Near Train Tracks?

Living near train tracks can have some health consequences. Exposure to noise pollution can harm health, including an increased risk of hypertension, cardiovascular disease, and anxiety. Do homes near train tracks hurt humans? Diesel exhaust from trains can have harmful effects on respiratory health. Exposure to diesel exhaust from trains can cause respiratory diseases such as asthma or chronic obstructive pulmonary disease (COPD).

Exposure to diesel exhaust conditions can lead to long-term health complications and cause symptoms like coughing, wheezing, and shortness of breath.

In people with pre-existing respiratory ailments, exposure to diesel exhaust might exacerbate their symptoms or even trigger asthma attacks. However, the risk depends on the frequency and intensity of passing trains. Residents who live near busy tracks or high-speed rail are at a greater risk. If the frequency and intensity of the passing trains are minimal, then the risk is lower.

How Often Do Trains Run Through The Train Tracks?

There is no set time when trains run. You can have a long-distance train run in the middle of the night that may last over an hour. Modern commuter trains have limited noise levels. However, how about freight trains that have several hundred railcars? We need to think about the noise level for years to come. This topic applies to older homes built near railroad tracks.

The constant daily rumbling noise and vibration of tracks can cause damage to homes. This holds especially true in older homes but can affect newer homes with solid foundations.

Heavy train loads can affect the ground. More so during winter times and rainy seasons. As time passes, these vibrations from train tracks can affect the structural makeup of a home, especially the home’s foundation. Windows and doors may not align properly. The closer a home is to train tracks, the more severe the damage can be.

Deals In Buying Home Near Railroad Tracks

Homebuyers can get deals when buying home near railroad tracks where it may not affect their resale value. The closer the tracks are to the subject property, the greater the noise and the fewer chances of appreciation. Homeowners can re-insulate the home to have less track noise. They can replace their windows with thermal windows to minimize noise levels.

How Do You Sleep With a Train Sound?

Freight trains are powered by diesel fuel, which can cause much pollution. Besides dealing with the load noise, there are other negatives to buying home near railroad tracks. The foundation and ground can shake. The pollution from diesel can create soot and fumes, often discoloring the home’s exteriors. The noise from the train is not the only problem buying home near railroad tracks. The pollution from the diesel engines, the ground shaking, and the traffic buildup are other negatives that needs to get addressed. Many communities have placed curfews for trains where they are not allowed to run during certain times of the day. Trains carry toxic materials. Accidents happen; the whole neighborhood may need to be relocated if a freight train with chemicals derails. There are pros and cons when buying a home near train tracks.

Resale Value of Buying Home Near Railroad Tracks

Pros and Cons of Living Near Train Tracks

Living near train tracks has its pros and cons. The pros include affordability: One of the most significant advantages of buying a home near train tracks is its affordability. Homes located near train tracks are often priced lower than those situated away from the tracks. This is because potential buyers are often intimidated by the sound and disturbance caused by trains passing by.

Living near train tracks might be a good option if you’re on a budget and want to save money. Convenience: Living near a train station can also be highly convenient for those who rely on public transportation.

It saves you time and money on transportation costs since catching a train from an adjacent station saves you the hassle of driving during rush hour traffic. This convenience can be a significant advantage for those who commute regularly. Unique Living Experience: Living near train tracks can add a unique appeal to a property. It can provide a feeling of adventure and add a certain charm to the surrounding area.

Negatives of Buying Homes Near Railroad Tracks

Noise Pollution: The most common complaint about homes near train tracks is noise pollution. The sound of trains passing by can be loud and disruptive, especially at night when you’re trying to sleep. For those who appreciate the rich history of railways or love seeing massive trains go by, it can be an exciting experience to live in such an area. The continuous shaking and vibrating of a home caused by rail lines could ultimately diminish its value over time, causing owners to spend more money than initially expected for upkeep. Consider the noise level of living near train tracks before you fall in love with a home near train tracks. Some people can take the noise while others cannot. The constant noise can result in considerable sleep loss, ultimately affecting your productivity during the day.

Safety Concerns Living Near Train Tracks

Safety concerns: Living too close to train tracks can be dangerous. While train derailments are rare, they can potentially result in devastating accidents. Children and pets may also risk wandering too close to the tracks and injuring themselves. Furthermore, constant and frequent vibrations from trains can cause significant structural damage to older homes.

Depending on the age and construction type of the house, vibrations from passing trains might cause severe damages that require regular maintenance and repairs.

Do not forget that people selling homes near railroad tracks will have difficulty reselling. Living close to train tracks may pose challenges when you try to sell your home. Some individuals may not want to live near the tracks due to noise pollution and safety concerns mentioned earlier. This could make finding a buyer for your property difficult or result in a lower resale value compared to homes further away from the tracks. Contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at alex@gustancho.com.

FAQ About Resale Value of Buying Home Near Railroad Tracks

1. What are the advantages of buying a home near railroad tracks?

  • Affordability: Due to noise concerns, homes near railroad tracks are often priced lower than those far away.
  • Convenience: Living near a train station can be convenient for those who rely on public transportation, saving time and money on commuting.
  • Unique living experience: Some may find living near train tracks adds charm and adventure to their living environment.

2. What are the disadvantages of buying a home near railroad tracks?

  • Noise pollution: The sound of passing trains can be loud and disruptive, especially at night, affecting sleep quality and overall well-being.
  • Safety concerns: Living too close to train tracks can pose safety risks, including potential accidents and injuries to children and pets.
  • Reduced resale value: Homes near railroad tracks may be difficult to sell due to noise pollution and safety concerns, leading to lower property values.

3. How much does living near train tracks affect property values? Statistics show that homes located within 1,000 feet of railroad tracks may experience a reduction in value by an average of 10%, give or take 3%.

4. What should be considered before buying a home near railroad tracks?

  • Noise tolerance: Consider how often and long you and your family would have to tolerate the noise from passing trains.
  • Structural impact: Vibrations from passing trains can damage the foundation and structure of a home, requiring regular maintenance.
  • Safety considerations: Evaluate the potential risks of living near train tracks, especially if you have children or pets.

5. Are there any health risks associated with living near train tracks? Exposure to noise pollution and diesel exhaust from passing trains can harm respiratory health, potentially leading to asthma or cardiovascular disease.

6. How close is too close when considering a home near train tracks? Experts recommend that homes be at least 500 feet away from tracks, with a minimum distance of 1,000 feet from junctions where trains switch tracks to mitigate safety risks and noise pollution.

7. Is buying a home near railroad tracks considered a bad investment? While it may initially seem affordable, the potential for reduced resale value and ongoing noise and safety concerns may outweigh the initial savings, making it a risky investment for some buyers.

8. How can I minimize the impact of living near railroad tracks?

  • Consider investing in noise-reducing measures such as insulation and thermal windows to mitigate the effects of noise pollution.
  • Regular maintenance and structural inspections can help address any damages caused by vibrations from passing trains.

9. What should I do if I’m interested in buying a home near railroad tracks?

  • Before making a decision, it’s essential to thoroughly evaluate the pros and cons, considering factors such as noise tolerance, safety concerns, and long-term resale value.
  • It’s best to consult a qualified real estate agent or financial advisor for personalized guidance.

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