LOCATION, LOCATION, LOCATION!
100 Real Estate Tips in 100 Days (Day 11)
This old adage seems to come up most every time someone talks about buying or selling a home. Seems like a good rallying cry from the sideline observers, and there certainly is a great deal of truth to the words. So let's look a little deeper:
- First and foremost, as a consumer, your only opportunity to have a choice in location is at the time of purchase. AS obvious as this fact is, it is forgotten or ignored by the average consumer way too often. Buying any real property not well located for its purpose is a mistake that usually manifests itself at the time of sale.
- Remember, at the time of sale, location cannot be affected by the seller except as a function of price. As an example, a certain style and model of a house will sell for 5% to 10% more in the interior of a subdivision that the same style and model located at the edge of the same subdivision backing to a 4 lane highway. So why do consumers buy the house backing to the highway?
- Emotions play a large role in the purchase of anything, especially a house that will become a home. Builders generally maximize the financial benefit of developing a division of land by building as many homes as possible on that land, building on the lots backing to that lane highway. This is done for reasons of profit, and is not inherently good or bad. There is no good reason why a consumer should buy a house that is located next to our proverbial highway, but many consumers do just that. They do so often because of poor or no advice. It is very important to have the services of an experienced professional to provide guidance when purchasing any home, but most especially a new builder home. All of the builder incentives in the world will not make up for that poor location when it comes time to sell.
- The home market has price fluctuations just as any market. The poorly located home purchased at the height of a market can become a nightmare when trying to sell at the bottom of the market.
- A consumer should always perform an independent investigation of any undeveloped land in close proximity to their "dream" house. Do not rely on anyone's statements regarding future land use. Due diligence performed by the buyer with school districts and other governmental entities will provide great peace of mind as the decision to purchase is considered.
- Always consider local government services, water sources, transportation corridors, shopping locations, schools and houses of worship when buying. Those things may not be important to you, but they will almost always be important to the future buyer of your home.
Remember, the only time that a consumer has influence on the location issue is at time of purchase.