Location, Location, Location - the true meaning behind it
Adrian Goslett, CEO of RE/MAX of Southern Africa, clarifies the well-known adage that the three most important factors when buying property are location, location, location.
Property experts all agree on one thing - that the three most important factors when buying property with the prospect of long-term growth are location, location, location. But what exactly does this mean?
Location refers to a number of factors that buyers should take into account before deciding which property to buy, explains Adrian Goslett, CEO of RE/MAX of Southern Africa. These factors are crucial, because they impact the growth in the value of the property over time, which will determine the price that can be achieved if the property is sold in the future, as well as the income the property can generate if it is bought for investment purposes.
Firstly, and most importantly, location refers to the area in which the property is situated. It is always better to buy a poor property in a good area, than to buy the best property in a bad area, explains Goslett. A good area is one in which there is growth and development, or significant potential for growth, which will support demand for property in the long term and, subsequently, determine property values in the future.
Choose an area with a good infrastructure, which is reflected in the provision of services. Steer clear of areas where crime is high or areas in which neglect and poor service delivery is evident in the state of the roads, waste collection and general maintenance of pavements, parks and public land. Buyers are also well-advised to find out more about the future development plans for the area. Developments such as new industrial sites, new roads or railways or industrial activities can signifcantly alter the profile of an area, warns Goslett.
The neighbourhood should also be carefully considered because the quality of the surrounding properties will affect the value of an individual property. Carefully consider a property surrounded by neglected or dilapidated properties, or situated next to vacant land, which could attract squatters or a low-cost housing development in the future. A property in a well-maintained developed area will grow in value because the supply of new properties is limited to the existing properties. This limited supply will also keep prices buoyant, he says.
The state of surrounding neighbourhoods should also be considered, since development or stagnation in one neighbourhood or suburb tends to spill over into those adjacent. Growth and development can be seen in the level of investment and commercial activity in the area. Property developers and national retailers do thorough market research before considering an area. Residential and commercial property development within the neighbourhood surrounds indicates confidence in the future growth of the area. Similarly, well-maintained, clean shops with bright, modern storefronts, as well as long-established or well-known brand names are indicative of prosperous areas. Beware of neighbourhoods with neglected or empty shops, a collection of second-hand goods shops and poorly stocked, unbranded convenience stores, advises Goslett.
A second aspect of location is accessibility. Given the lack of public transportation in South Africa and the long distances most people drive to work and back, a good location encompasses easy access to highways and transport routes. Proximity to Gautrain stations or bus stations will become more important as our countrys public transport services improve, notes Goslett. However, proximity to the highway or the railway line could mean that the property is exposed to significant noise and pollution. Finding the right balance is therefore important in choosing a location.
Another factor in determining the right location is the proximity of quality amenities including shops, parks, theatres, restaurants and public services, such as schools and hospitals. In a modern world, convenience is highly valued and a location close to quality amenities will positively influence the value of a property, says Goslett.
In essence, then, when you hear the old adage location, location, location, remember that this, in reality, refers to a confluence of different factors to pinpoint a property in an area that is growing and developing to sustain long term value, while offering quality of life and convenience. Finding such a property may take a little more effort and time, but the future benefits of solid growth in the value of the property certainly makes it worthwhile, he concludes...
Article from: www.remax.co.za