The Reality of "Location, Location, Location"

By
Real Estate Agent with Realty Executives Leading

The Reality of “Location, Location, Location”

Why do we realtors state that word three times?  To emphasize its importance, and when you ignore that, you will likely regret it.

As a buyer myself, I ignored it twice in the last 30 years.  One of those times was when I remustered to a Structural Technician (changed trades) while serving in the Canadian Armed Forces.  My first posting was to Wainwright, Alberta where housing was pretty pricey, so we decided to purchase a major fixer upper in Czar, Alberta (200 people and 10,000 head of cattle), 50 km south of Wainwright.  My thinking was twofold:  we could buy a house a lot cheaper in Czar, and this would be good practical experience to experiment with my new construction trade.  We could add sweat equity to this house, making a really nice home and still be competitive with the Wainwright market.

My wife Paulette and I spent the next 3 ½ years gutting the house, including the interior walls, kitchen, basement, lighting, electrical … In the end the house turned out beautiful.  But when we got posted to the north end of Vancouver Island, no one wanted to buy the house, because we could not compete with the buyers’ desire to live in Wainwright.  To make a long story short, we rented the house to the only person who applied, and that person trashed the house.  I took time off, came back to Czar, fixed the house up for sale and put it back on the market, selling it for what the market would bear. The lesson here:  Buyers will pay a premium to live where they want to live.

“Location, location, location” usually means attractive neighbourhoods close to schools, hospitals, and facilities for entertainment, recreation and shopping.  It can mean proximity to a lake or backing onto a park, green space or golf course.  Homes in undesirable locations might be next to commercial/industrial buildings, beside railway lines, under flight paths, or in neighbourhoods with high crime rates.  Also included are economically depressed areas, where neighbours show zero pride of ownership in maintaining their homes and yards. 

Although you will pay a premium to buy in a desirable location, the payback is well worth the extra cost.  Desirable locations sell quicker, usually appreciate at a greater rate, and are likely to sell before less desirable locations even when the market is slow.

From my past experiences, if budget is an issue (and when isn’t it?), I would settle for a smaller home located in a desirable location, later moving up to a larger home when I could afford it.  It cost me to learn this lesson, but I am happy to pass it on to my clients!

Posted by

 

Barry Twynam, REALTOR®

Realty Executives Leading

www.barryt.ca

Cell:     780-910-9669

Office:  780-962-9696
Fax:     780-962-9699

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Rainmaker
784,380
Ed & Tracy Oliva
West USA Realty - Arizona - Fountain Hills, AZ
The Oliva Team Arizona Agents

I think location location location speaks for itself. So Yes Location Location Location.     Good Luck E

Jan 25, 2012 02:44 PM #15
Rainer
329,276
Donald Reich
Prudential Centennial - New Rochelle, NY

So many home owners (Sellers) don't get it. They do not understand that their house on a busy corner is worth less than the house on a dead end street  . . . or that the different (poorer perfroming) school district means that your house is worth less, than a house a block or 2 away in a different district!

Jan 25, 2012 02:46 PM #16
Rainmaker
944,462
Joy Daniels
Joy Daniels Real Estate Group, Ltd. - Harrisburg, PA

If it's not location, location, location, then it's price, price price. . . not a good location then the price must be lower.  :)  Thanks!

Jan 25, 2012 03:18 PM #17
Rainmaker
1,561,913
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

If only buyers would realize this before they buy in Czar ;-)  Many people don't think about the re-sale.  Great post to make a point from person experiences and lessons learned.

Jan 25, 2012 04:02 PM #18
Rainer
172,705
Luis Iniguez
Option One Real Estate - Fontana, CA
Search Inland Empire Homes For Sale - Short Sale Agent

The location always speaks for itself.  It really takes good research to find location and price.

Jan 25, 2012 04:14 PM #19
Rainmaker
129,311
Kamal Salim
Lokation Real Estate - Weston, FL
A Superior Level of Service !

Also, you can change everything in the house, you can even knock the house down and rebuild it, but you'll still be in the same location. You can change everything, but you cannot change the location of the house

Jan 25, 2012 04:50 PM #20
Rainmaker
908,388
Pamela Seley
West Coast Realty Division - Murrieta, CA
Residential Real Estate Agent serving SW RivCo CA

Thanks for sharing your story, as this is a good learning experience. Location becomes very important when it comes time to sell. In this market, it is more noticeable how price reflects a desirable or not-so-desirable location.

Jan 25, 2012 06:19 PM #21
Rainmaker
4,799,256
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

It remains the mantra for where people would prefer to live.  It often comes with the premium just because of the location!

Jan 25, 2012 10:02 PM #22
Rainmaker
501,727
Barbara Tattersall
Keller Williams Realty Metropolitan (Keene,NH) - Keene, NH
GRI

A good reminder....Lots of young buyers are going with price, price, price and paying the price down the road for an over improved home for the neighborhood.

Jan 25, 2012 10:39 PM #23
Ambassador
2,664,376
Ed Silva
Mapleridge Realty, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

It is true on both sides of the scale. I was called in do a Market Analysis, yesterday on a home that 20 years ago was in a prime location. Since then traffic patterns have changed and this home not rests on a dead man's curve with 24 hour a day noise. Their value dropped because the location changed.

Jan 25, 2012 11:24 PM #24
Ambassador
2,083,743
Fernando Herboso - Broker for Maxus Realty Group
Maxus Realty Group - Broker 301-246-0001 - Gaithersburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

This is why our services are important for buyers. .  location matters just like the real estate agent matters

Jan 25, 2012 11:32 PM #25
Rainmaker
221,086
Richard and Jean Murphy
Harborview Properties - Portland, ME
(207) 712-4796

Our clients typically say this before we do. Not being professional Realtors, they usually say it in the incorrect order.

Jan 25, 2012 11:47 PM #26
Rainer
387,720
John F Muscarella
RIVER FARM PROPERTIES, LLC - Venice, FL
Broker/Owner, Venice, FL, Florida's Suncoast

You point out the immutable law of real estate and you're right - it should never be underrated.  Good post.

Jan 26, 2012 12:27 AM #27
Rainmaker
1,430,677
Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

Barry, unless a family plans on living in their home forever, it will pay in the long run to think about resale value. Thanks for the lesson.

Jan 26, 2012 12:31 AM #28
Rainmaker
2,590,754
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

When my wife and I were buying homes, when we found the jewel we were looking for, we moved at light speed to get it...No haggling just focused results to purchase. Then, every time it came time to sell, we got top dollar and met our like kind. Location, premium product, and all the rest of it produce consistently time and again...

Jan 26, 2012 01:37 AM #29
Rainmaker
316,612
Sandy Acevedo
951-290-8588 - Chino Hills, CA
RE/MAX Masters, Inland Empire Homes for Sale

Hi Barry, the location lesson was taught to me as a newlywed, before we bought our first home. It was our first apartment, located on a busy street. The noise from many vehicles and motorcycles at all hours taught me well!

Jan 26, 2012 03:11 AM #30
Rainer
159,583
Glenn Freezman
Family Abstract, Inc. - Horsham, PA

Barry, this reminds me of a joke.  realtors always say they love real estate. sO...  Does making Love and real etstae have anything in common.  Well, yes they do, its not so much how you do it, ITS LOCATION, LOCATION LOCATION.

Jan 26, 2012 04:35 AM #31
Rainmaker
570,426
Christine Smith
Buyers Brokers Only LLC - www.BuyersBrokersOnly.com - Canton, MA
Exclusive Buyer Agent & Attorney, Canton, MA

Barry....I always tell people that location is the one thing you cannot change.  So what was the second time you ignored location?

Jan 26, 2012 05:04 AM #32
Rainer
163,939
Barry Twynam
Realty Executives Leading - Spruce Grove, AB

Thanks so much, everyone, for your great comments!  Your feedback and encouragement, as well as your own personal experiences, are greatly appreciated.

Jan 26, 2012 07:15 AM #33
Rainmaker
718,263
Ruthmarie Hicks
Keller Williams NY Realty - 120 Bloomingdale Road #101, White Plains NY 10605 - White Plains, NY

There are things that simply can't be altered....Location being the main one. 

Jan 26, 2012 07:41 AM #34
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Rainer
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