THE IMPORTANCE OF LOCATION IN A REAL ESTATE INVESTMENT DECISION

Melbourne July 2015: "Location, location, location" is an over used but often little understood summary of what to think about when buying real estate. What does "location" mean?

For the purposes of this article, we will talk about Melbourne property. As Australia's second largest city, there will be thousands of old, recently built and new properties for sale in Melbourne every day.

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Location as a starting point core property buying choice decision feature, does not matter whether you are in the property market for vacant land, a home unit, an apartment or a suburban house. Location applies to all types of property because people want to get the best possible deal and obtain the best possible capital gain potential.

Surprisingly, price does not determine whether a property is a bargain or not when a buyer forgets about location. A run down farm house 200 kilometres from Melbourne and 10 kilometres from the nearest town might be cheap but it is probably not a bargain or a good property to buy. Real estate agents know that the best property deals involve a lot of money but represent good buying choices because price in itself is not a measure of value.

Real estate buyers should obtain expert advice from people who know the property industry in Melbourne because with guidance, buyers can obtain a good deal in a very good location. It is about "knowledge". Learning about Melbourne property from an expert is an important step in the property education process. Buyer's agents are used by investors and home seekers to assist in locating first class property in the best locations around Melbourne. For a fee, they give their clients the benefits of their local property knowledge.

"Buyer's agents will have their favourite suburbs for investors and often a second list of options for home seekers."

Anyone looking for property without expert property advice will have to do their own investigations about every property that is on their for sale list and seek out property developers to see what new projects are available. Property experts already know that insider information. So, why not get in touch with a property expert to save time, get access to new projects and learn about the best property Victorian locations.

Property valuers consider a huge range of factors about a property when they are asked to provide a valuation. Just some of the things that they consider are:

  • Land value
  • Value of the improvements
  • Condition of the improvements
  • Relative scarcity of the property type
  • Proximity to schools
  • Availability of public transport
  • Nearby recreation facilities
  • The quality of the neighbourhood in subjective terms like crime rates, socioeconomic standing and ratio of private to public housing.
  • Shopping facilities
  • Planned and future good and bad developments in the area like new buildings or roads
  • Recent sale prices
  • Demand for property in the area
  • Historical price value growth of the area down to particular streets in a suburb.

When buying real estate there is a lot to consider. Expert property advisers will charge for their time and to share their insight into the property market, however, the cost will be a wise investment in securing a deal that will bring pride when you share the news with friends and family. On the other hand, in years to come you will not want to find out that in the next street over prices are higher because of some factor that you did not consider when you thought about "location".

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