Why Location Is King When It Comes to Home Buying
If you are shopping for a home, you should know by now that location is the best card to have in your deck.
Real estate agents will constantly remind you of "location, location, location" and they are definitely not wrong about that.
You can always make changes to the home, but you can never move it from its location!
Some neighborhoods change; sometimes for the better, other times, they worsen.
Should you go for the best home in the worst block, the best home in the best block, or the worst home in the best block? And how about the worst home in the worst block?
Without further ado, here is what you need to know about why location is king:
1 - When buying in a GREAT AREA at a LOWER PRICE
A home could be near the best school district in the best neighborhood of any town, but if it is close to a busy street or a commercial shopping centre, the value is probably going to drop, especially if it is next to a freeway.
If you want to be in a great area, but you don't want to pay too much, it would be advisable to rather buy a home with a slightly undesirable feature.
Of course, as long as its location is good!
2 - When buying the BEST HOUSE on the BEST BLOCK
This is a great choice if you're willing to stick around for a while!
It's no doubt the safest choice because the house will very likely hold its value.
However, as a home buyer, you should understand that you are going to be paying top-dollar for your A+ house in your A+ neighborhood.
And in today's world, people move around fast: people get promoted, get divorced and move around at a quick rate, so it is less common for someone to stay in a house for 20 years.
In other words, if you move around, the best house on the best block may not have time to appreciate for long enough in terms of your investment.
3 - When buying the WORST HOUSE on the BEST BLOCK
No one can take a good location away from you, so this is a good choice if you're willing to work on it!
Smart real estate investors also know that a house in a good area tends to be a great investment!
In many good neighborhoods, investors often make bids for terrible-looking houses because of its location.
For a home buyer who isn't afraid of a bit of work and some renovations, this is the best purchase to make. Once those home renovations are done, you will very likely be sitting on equity.
Don't be afraid to buy a home that needs work if it's in a good location.
4 - When buying the BEST HOUSE on the WORST BLOCK
Paying a whole lot of money for the best house in the worst area could present serious consequences.
So, you may want to proceed with caution! You might never gain full equity, even after living in the house for many years.
This is an investment best suited for experienced property investors!
5 - When buying the WORST HOUSE on the WORST BLOCK
You should definitely not have doubts about this one as it may be worth the gamble. If you are buying in a bad neighborhood or a transitioning neighborhood, you should know that there are no guarantees.
You can't always predict the status of a neighborhood but if you want to challenge it, then this is the way to go.
Sure, you can make changes to the house and if the neighborhood improves, you could be sitting on huge equity and a very fruitful investment!
In the end, it is almost impossible to tell what would happen to a location or a neighborhood. Never mind trying to predict the way that your house might go!
If you are a first-time buyer, keep these 'location is king' theories in mind when you go about your real estate shopping.
