If you ask people what is the most important thing when purchasing real estate, they will usually respond with the well-known adage “location, location” which emphasizes how crucial it is to choose the best location. Property in an ideal location is likely to have a greater property value and higher appreciation rates, as well as a superior quality of living.
First to Say?
I was looking forward to digging deeper into the history of the famous phrase when I wrote this article. However, it was surprising to discover that no one knows where this saying originated.
Some journalists reported that Lord Harold Samuel was an English real estate magnate who first used the phrase. The New York Times, however, found that the phrase was first used by a Chicago Tribune classified in 1926.
No matter where the term originated, the fact remains that it is one of the main considerations for buying a property.
Factors To Consider
When it comes to choosing the perfect property, there are several factors that you should consider. They include:
- Distance from work, school, family, and friends: Is the property close to your workplace, your children’s schools, or any other destination you intend to visit frequently?
- Use NeighborhoodScout, a free tool that provides information about the crime rate in the neighbourhood to research its safety.
- Location: Take into consideration the proximity of amenities such as grocery stores, gyms and hair salons. Also, consider shopping centers, hospitals, parks, restaurants, etc.
- Transport: Other factors to consider are accessibility of public transport, the freeways and proximity to airports.
- Future Development: Do you know of any developers working in your region on large projects that may impact the area’s future desirability?
The House Itself
After you’ve identified the opportunity, you should consider other factors such as location.
- It is important to know the area you will be buying in. You should consider the neighborhood, the HOA that governs the area, the gated communities, the age of homes in the community.
- Consider any external negative factors. You can consider a commercial building nearby, the noise of traffic, or the fact that the house is located in a flight path for a nearby airfield.
- Sun exposure is a major factor to consider, particularly when purchasing in desert climates. Sun exposure can affect utility bills as well as the natural lighting in a home. A home with a south/north sun exposure is ideal for a desert environment like mine.
- Are the neighbours around the house you’re considering buying proud of their home? The appearance of the neighborhood will affect the value of the home you are considering.
Location and its Significance
Location is a very important factor that cannot be ignored or underrated. Some of the many ways that location will affect you as a purchaser include:
- Location is a key factor in determining the value of any property. Houses in desirable neighborhoods, near desirable amenities and within a desirable school district are more expensive than similar properties in less desirable areas.
- A great location is a key factor in increasing the value of your investment over time.
- The quality of your life is greatly affected by the environment you live in. If you choose a location that is convenient and offers many amenities, your life or the lives of your tenants will be improved.
- Potential for resale: If you intend to keep your property long-term, choosing the best location will be beneficial. Property in an attractive location is more appealing to potential buyers, increasing your chances of selling it faster and at a higher price.
The Bottom Line
When buying property, we should all be aware of this timeless rule “location,location,location”. In my journey of real estate investing, I’ve made a couple of mistakes. I bought properties in locations that didn’t meet all my criteria because I wanted to get another deal. Both times, ignoring this rule led to me not being able to achieve my goals.
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