How to find out...

To do so would flat out risk our friendship and being neighbors though, is what I worry about.

You just answered your own question. Don't. Unless she makes the first move, and even that puts your existing friendship on the table.
 
How far we have slid from the conventional social process.

Try asking her out on a date. See how you two work together.
 
to the OP:
1) You didn't say if your neighbor is married or single. You didn't say if YOU were married or single. If either of you are married, dangerous move. If single, take TarnishedPenny's advice. If she likes Mexican food, simply suggest that some night you take her out for Mexican. If she mentions a particular movie that's up for an Oscar, offer to take her to see it. Keep it very casual at first till you see how she responds.
2) After a casual date or two, ask her over for drinks and to watch a movie or call out for a pizza. If she comes over, then you can start opening up that you find her attractive and would like to have more than just a neighborly arrangement if she's of the same mindset.
 
Compliments are a good start. Tell her how great she looks and see how she reacts. Let her know if she ever needs help or anything around the house to let you know and you can help.
 
Ohhh milkendel, very good suggestion. If indeed she is single and lives alone, many women would love to have a guy who's handy with fixing stuff. I suspect that there are some women out there who have sabotaged their own toaster to have a neighbor guy come see if he can fix it.

Also, nothing was said about how much older this woman is. She may say she feels awkward about some sort of age difference more than a few years. But, I once had a lady friend that was 10 years older than me and loved being told she looked 15 years younger. Most mature women get depressed about not turning as many heads as they used to. Even my own wife confided that she used to love walking the beach and feeling eyes of men following her tits and legs and ass. Then, years later, she confided how depressed she was that she could tell that not as many of the young bucks looked at her with lust because she looked too much like their mother. Nobody yearns to be considered desirable and sexy more than a middle aged woman.
 
Ohhh milkendel, very good suggestion. If indeed she is single and lives alone, many women would love to have a guy who's handy with fixing stuff. I suspect that there are some women out there who have sabotaged their own toaster to have a neighbor guy come see if he can fix it.

Also, nothing was said about how much older this woman is. She may say she feels awkward about some sort of age difference more than a few years. But, I once had a lady friend that was 10 years older than me and loved being told she looked 15 years younger. Most mature women get depressed about not turning as many heads as they used to. Even my own wife confided that she used to love walking the beach and feeling eyes of men following her tits and legs and ass. Then, years later, she confided how depressed she was that she could tell that not as many of the young bucks looked at her with lust because she looked too much like their mother. Nobody yearns to be considered desirable and sexy more than a middle aged woman.

She is old enough to be retired. She is divorced. I have been in her house because, well, I am just that kind of friendly and trusting person and I have help her whenever she needs it since her son is too busy but lives locally. She has the key to my house for checking on my cat and I can't get home. I found myself attracted to her and, oddly enough, when my last wife was alive, my wife even said if she was interested in me that I would have my wife's blessing. Now I am wondering if there was something more to that.
 
I think that I would say "We've been friends for a long time. Have you ever considered taking it to another level? If not, I would have no hard feelings, and would be happy with leaving things as they are. I just want you to know how I feel about you."

You should also make it clear that you're interested in a "friend with benefits" and not lead her into believing that you're making more of a commitment. It's entirely possible that such a situation might be against her moral principles, and if it is, apologize and explain that you misconstrued the situation.

If your friendship is really solid, and you've made it clear that there's no pressure on her to answer one way or the other without jeopardizing it, then go for it. She might even appreciate the honesty, if not the compliment. If she doesn't, maybe she wasn't the good friend that you thought she was.
 
She is old enough to be retired. She is divorced. I have been in her house because, well, I am just that kind of friendly and trusting person and I have help her whenever she needs it since her son is too busy but lives locally. She has the key to my house for checking on my cat and I can't get home. I found myself attracted to her and, oddly enough, when my last wife was alive, my wife even said if she was interested in me that I would have my wife's blessing. Now I am wondering if there was something more to that.

You could ask "have you ever considered dating again?" or something along those lines.
 
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