How do you determine if you are investing in the right neighborhood that will be very lucrative? Buying an investment property in the wrong neighborhood can affect your cash flow and cost you more money than expected.

Understanding how to analyze a potential neighborhood investment will allow you to get the most out of your rental property. Here are a few things to consider when investing in the right neighborhood.

The Business: Airbnb vs. Traditional

Make sure you know exactly how you want your property to generate cash flow. Stick to middle income neighborhoods if you want to rent out your property in a traditional manner. However, if you want to take a nontraditional approach to your investment property such as listing it on Airbnb, you might want to consider more of a high traffic area with nearby tourist attractions.

Related: Four Things to Consider Before Purchasing An Airbnb Investment Property

If you’re on a tight investment budget you might want to consider low-income neighborhoods. These neighborhoods typically have affordable, low priced properties and generally have high rent-to-value ratios. Normally, residents of these neighborhoods are on government assistance such as Section 8 housing assistance, which is a reliable source of rent.

How’s the Competition?

Institutional and professional investors have been snatching up single-family homes in the hardest hit markets across the nation. They’re grabbing potential high performing properties with the goal of yielding high-returns from rental income and recovering house prices. This is a good indicator of a neighborhood that will outperform the market.

These investors have been in business for a while and might be ahead of you but don’t let this limit you. There are plenty of opportunities that no one person or group can ever completely capture. Get creative and hire an experienced Realtor to quickly find and acquire a high-return investment.

The Airbnb Neighborhood

Certain neighborhoods are undoubtedly high-return Airbnb neighborhoods, these neighborhoods are usually central and tourist destinations. For the most part, these neighborhoods have an excess of Airbnb properties, which might make it very difficult for you to compete with experienced Airbnb Superhosts.

Finding the few remaining neighborhoods with a reasonable competition still generating a high return is not an easy task for most Investors. Mashvisor’s Airbnb Analytical report is assisting real estate investors to pinpoint high performing neighborhoods by analyzing real-time real estate data.

The Science of a Latte

When it comes to real estate investments, it’s important to have multiple top-rated schools, low crime and a Starbucks. A study that compared a database of Starbucks locations with real estate data found that the two are closely correlated. Upscale retail chain are signs a neighborhood is well established and properties near these locations typically appreciate at a faster rate.

These business have done the market research to assure that the neighborhood is stable and worth the investment. Companies like Starbucks have a team of experts that analyze areas to assess the value of the area so you can feel confident with their assessment of the location.

Related: Choosing the Right Investment Property for Your Short or Long Term Rental

Is it in walking Distance?

Having your investment within walking distance of public services is always an added value for you and your tenants, whether you decide to list your property on Airbnb or as a traditional rental. Homes with easy access to public transit or walking distance to desired areas will fetch higher rent than similar homes that are further away. You can get a property walkability score from walkscore.com.

Make sure to choose a property that is conveniently located yet don’t get too close. Find a property that is walking distance but not adjacent to bus stops or high traffic services. Make sure your tenants can enjoy their privacy yet have nearby accessibility.

If all of this seems like a foreign language to you, don’t stress. Mashvisor and other online resources can give you the knowledge you need to locate the right neighborhood and invest in a property that is a good fit for your situation. Pay attention to these five things and you’ll surely find the right neighborhood to invest in.

Thinking about investing in real estate? Visit Mashvisor.com to locate top real estate investments and to optimize your rental performance.