An old real estate saying goes: “The only three things that matter in real estate are location, location, and location.” You can own a ten-bedroom palace with eight-bathroom and the ceiling of a cathedral in it, and a swimming pool in it; if it’s sitting next to a refuse dump, that property is almost worthless. At the same time, a little one-bedroom with a little bathroom on Victoria Island will be worth so much more fortune.
The difference is not in the type of building but in the location of the building.
Just as the moon shines brighter at night when it is well positioned towards the sun, so does your real estate have more value and increase when you find a great location for it.
Location is the most important factor to consider when considering a piece of real estate to invest in.
So what Makes a Location Valuable?
The answer is simple, Desirability. When people and buyers desire a location, it becomes a valuable location.
Simple as that sounds, Desirability is not a tangible factor to hold on to, like one thing that is undesirable to one person is just a dream come true for another person. And this is just the phenomenon that is true for both investors and home buyers, and also renters,
Before buying, every real estate investor should consider what their strategy is. Profit is the main goal. Buying a property is only half of the equation; if an investor seeks to make a profit sooner, the location will determine the strategy used.
Getting prime real estate is the best choice for investors who desire to wait for short-term for-profits. Houses in locations where entertainment centers or developing areas are found would be the best area for that property to increase in value simply by waiting.
On the flip side, if an investor is looking to invest in a property to rent it and make a monthly or yearly income, then the investor is better off going to urban areas to get the properties.
Urban properties are not “prime” real estate properties, but they are good for rental as they are situated with a lot of population. So the goal determines the strategy, and the strategy determines the location.
So the goal determines the strategy, and the strategy determines the location.
Real estate investors like to fix old houses and sell them. They like to get handy on properties, make renovations and sell them off at a very nice profit.
The locations for these kinds of houses are mid-priced houses in working neighborhoods. This kind of neighborhood provides the right deals for investors who like to flip houses and sell or rent quicker.
Factors Investors Consider When Deciding A property to Buy
There are many factors that investors in the real estate space consider before they invest in a property. The following are some of them.
- SNOB Factor: this factor arises when people pay a lot more for a small property in the “right” location/neighborhood than pay for a larger property in a less desirable area. This is sometimes strange.
However, the right neighborhood for one person is different from another’s definition. If a property is visible, it increases in value, so when the smaller property is located in a more visible locale, its value increases, and so does its demand. - Convenience: This is another factor to consider when looking at the Desirability of the location of a property. People mostly like to live in areas close to their children’s school, where they work, and where they can get access to some facilities.
Many factors determine the Desirability of a location for real estate investors and homebuyers. If the location is desirable for the investors’ purposes, he will buy.
If the location is desirable for the homebuyer’s purpose, he will buy. If the location is desirable for the renters’ purpose, then he or she will rent. So basically, you can say all the various factors used in determining how good or bad a location is down to just one word, Desirability.
“Beauty is in the eye of the Beholder,” as it said, and so is the location in the eye of the real estate investor, buyer, or renter. So if the location serves your purpose, it is a good location.
Remember to share and invite your friends to read more of our articles. If you want to buy real estate land for any purpose, reach out to Piedras Properties and Investment Limited.
We have lands in various locations to fit your needs and desire. You can check out our properties section by clicking this link and see the one that fits your budget and desire.
You can message us on Whatsapp wa.link/wj66os or call us via 08090772577
