If agents want to make the big cash by targeting the newest trendy neighbourhood, they need to start getting more creative and start following the groups that transform the bad neighbourhoods into good.
And the primary group to keep an eye on is artists, says real estate guru Stefan Aarnio.
“Like every investor, I always need to know where the next up-and-coming neighbourhood is and that is why I did a lot of deals in Wolseley (Winnipeg),” he says. “Artists tend to look for cheap rental areas and then huddle together. They always go for the little communities and give them character and coolness.”
And it is when the “hipsters and yuppies” descend upon the communities that Realtors can enjoy the influx of business.
Aarnio points to the Junction, Toronto, and James Street North, Hamilton, as two other areas were artists have turned once run-down areas into real estate gold.
“I have been tracking the value of properties and shift in market around Winnipeg for years and it’s always proven to be a good move,” he says, adding that investors that should not be so dismissive of “undesirable” and affordable areas.
He refers to this “bad” stage as stage three or four of a neighbourhood's cycle, where the area and homes are in a state of disrepair. Such areas can be rampant with drugs and crime, as well as pawn shops and soup kitchens. He says that every 100 to 125 years neighbourhoods go through a stage of gentrification, with artists spearheading this local development.
If you want to get into the next ‘hipster’ market, you need to start following the city’s artist groups today.