Location Location - but Which Location
Category News
There are still three basic requirements for successful property investment – location, location and location. It’s just that now, the choice has been multiplied and also complicated by changing lifestyles.
It used to be the case, for example, that those who could afford to buy the more expensive homes in the older, more central suburbs of a city could also usually look forward to bigger and faster increases in home values than those who bought the less expensive properties in newer, less central suburbs. In other words, there was a relatively simple trade-off between affordability and investment performance.
These days, however, things are not so simple, because there are many factors in play that may carry more weight with current or future buyers than the reputation or status of an area - or even than the possible future increase in the value of a property.
For example, homes in proximity to a highly-rated school will be of much more value to some people than they might have been a few years ago, and such buyers may seek out these properties without worrying too much about what is happening to property values in the rest of that area.
Similarly, living close to an international airport may be a priority for someone who has to travel a lot for work, whether or not the suburb is well-located in other respects.
On the other hand, personal security has become a major concern for most buyers, which is why homes in boomed areas or in gated communities with access control and 24-hour patrols will almost always now command higher prices than similar homes without such safeguards, even if they are in less sought-after areas.
Meanwhile, soaring transport costs and increased traffic congestion have already prompted many people to move closer to their workplaces – and if these happen to be somewhere further from the city centre and have fewer attractions and amenities, too bad.
Indeed, SA’s rapidly urbanising population and quickly expanding cities have brought about the development of many satellite business districts each surrounded by their own group of suburbs that have their own property value dynamic quite independent of those prevailing in the “old town”.
So, although the principle that location is critical stands, property buyers now have much more complex choices to make when it comes to considering which locations are likely to perform best in the long run while also enabling them to enjoy a quality lifestyle. And in order to make the right choices, they should always seek the help of qualified and experienced estate agents who have access to in-depth local market information.
Author: Barry Davies