About our Local Risk Index

What is the Local Risk Index by aterio?

The Location Risk Index is an integral part of the Aterio Score, designed to assess various risk factors that could impact real estate investments in a specific area. This index provides a numerical score that reflects the potential risks associated with investing in a particular location. It is calculated by analyzing a range of critical indicators, including unemployment rates, foreclosure rates, the availability of clean drinking water, and local news about plant closures and layoffs.

Understanding unemployment rates helps gauge economic stability in the area, as high unemployment can lead to decreased demand for housing. Foreclosure rates indicate financial distress among homeowners, which can affect property values. The availability of clean drinking water is a crucial factor for livability and can impact long-term property desirability. Additionally, news about plant closures and layoffs provides insights into local economic conditions and potential future risks.

By incorporating these factors, the Location Risk Index offers a comprehensive view of the potential challenges and pitfalls in a given real estate market. A high-risk score might signal a need for caution, whereas a lower risk score could indicate a more stable investment environment. This index enables investors to make more informed decisions by understanding and managing the risks associated with different locations, ultimately supporting strategic real estate investment planning​