Urban Properties
With Resale Potential

Real-estate experts are always on the lookout for urban neighborhoods with upside potential. Here are three properties in locations that have begun gentrifying.

* * *

PLACE/PRICE: Albany Park, Chicago /$385,000

PROPERTY TAX: $2,900

THE PROPERTY: 2,800 square feet with 3 bdrms, 3.5 baths.

DESCRIPTION: A multicultural enclave on Chicago's north side. Prices haven't yet taken off even though it's sandwiched by more fashionable neighborhoods Lincoln Square and Old Irving.

NOTABLE: The house is a half-block from the commuter line, a 20-minute ride from downtown. Fenced front and back yards, plus a vault in the master bedroom.

* * *

PLACE/PRICE: South Boston /$819,000

PROPERTY TAX: $3,175*

THE PROPERTY: 2,750 square feet with 4 bdrms, 3 baths.

DESCRIPTION: A bastion of Boston's working-class Irish, "Southie" was connected to the rest of the city by the Big Dig. The cleaned-up waterfront is bustling with development.

NOTABLE: Right on the neighborhood's main drag, the restored Victorian is within a mile of downtown and steps from the waterfront. A rooftop cupola offers city views.

* * *

PLACE/PRICE: Hayes Valley, San Francisco /$1.1 million

PROPERTY TAX: $5,664**

THE PROPERTY: 2,550 square feet with 4 bdrms, 3 baths.

DESCRIPTION: Once home to prostitutes and an unsightly freeway that was damaged in the 1989 earthquake. The city replaced the freeway with a landscaped boulevard, just open this year, full of galleries and boutiques.

NOTABLE: A rehabbed 1876 Victorian rowhouse, it has views of city hall and sits a short walk from Alamo Square's famous "postcard row."

Note: * With primary-residence exemption, ** New owner's taxes will be 1.164% of sale price.

Sources: bairdwarner.com; seaportrealtygroup.com; bonniespindler.com

Email your comments to rjeditor@dowjones.com.