“Location, location, location” is a common mantra in real estate, and it is good advice—except for one thing: Most people have no idea what it means.
Why Is Location Important?
Most people decide to buy a property based on how much they like the house or apartment, but you are also buying a plot of land when you buy a property. The house currently standing on that land can be renovated or remodelled, but you can’t change where the home is situated.
Homebuyers and Location
A “good” location for homebuyers usually has transport links, well-ranked schools, and community involvement.
The second important factor to recognise is that a “good” location or a “bad” location won’t stay that way forever. Cities, towns, and even suburban communities are constantly changing, and neighbourhoods can transition from less desirable to “up and coming” within a few years. For example, if a major employer has just opened near an affordable neighbourhood, it’s often worth buying in that location.
5 Factors of Location
A good location can mean different things to different people, of course, but there are also objective factors that determine a home’s value.
Depending on your personal needs and preferences, you may not be able to buy a home with all of these factors, and that’s OK. After all, a home is much more than just an investment.
When you are home-hunting, pay attention to nearby amenities. Buyers usually want convenient grocery stores, good roads, schools E.T.C. Proximity to these amenities will typically improve a home’s value.
However, the next time you’re shopping for a new property, keep five factors in mind.
- Centrality
Where you choose to live in a city or town will undoubtedly affect how much you pay for your home. Land is a finite commodity, so cities like Lagos which are highly developed and don’t have much room for additional growth tend to have higher prices than cities with too much room to expand.
Research whether anything is going to substantially change the area, such as any planned developments or construction or new housing projects. A location may seem ideal only to undergo sweeping changes. Some changes could be positive ones that improve an area’s desirability.
- Neighbourhood
The neighbourhoods that appeal to you will essentially be a matter of personal choice. However, a truly great neighbourhood will have a few critical factors in common: accessibility, appearance, and amenities. Your neighbourhood may also dictate the size of the plot on which your house is built.
In terms of accessibility, you should look for a neighbourhood with more than one entry point. Commuting to and from work is a big part of many people’s days, so a house with easy access to roads and public transportation will be more desirable than one tucked away and can only be accessed by one route.
You can also judge the neighbourhood’s popularity based on how long homes in that area stay on the market; if turnover is quick, you’re not the only one who thinks this is a desirable place to live.
- Development
It is not just the present amenities that matter, but future ones as well. Plans for new schools, hospitals, connecting roads, and other civic infrastructure can dramatically improve property values in an area.
Commercial development can also improve property values. When you’re looking for a home, try to find out whether any new public, commercial, or residential developments are planned and consider how these additions might affect the desirability of the surrounding areas.
A neighbourhood that has a low crime rate and is an inviting and safe place to be outdoors and socialise with neighbours is the type of place where most people want to live.
- Future appreciation potential
If the home is located in a desirable neighbourhood in a location where people are moving, then you can expect the home’s value to stand the test of time – and even appreciate – throughout the years. As the demand for a location increases (and as the location improves), the appreciation will also continue to increase.
- The Home You Purchase
There’s one aspect of house hunting that tends to surprise people. Let’s say you’ve narrowed your choices to two homes that stand side by side in a great neighbourhood. One needs repairs and updates but has a huge plot size. The other is in tip-top shape but sits on a plot half the size of the other. If the prices of the two homes are similar. Which do you choose? In most cases, the house in need of repairs is the better investment.
The reason: your physical structure is a depreciating asset. On the other hand, the land will maintain its value (or likely appreciate) relative to the house. If you bulldozed both houses, the larger plot would sell for more. So, if you can, choose a bigger, better-shaped, or better-situated plot over a nicer house. A less attractive house can always be updated, added on to, or replaced altogether, but the land size can’t change.
The Bottom Line
Location isn’t entirely subjective—in fact, it’s based on a fairly static set of criteria. When you set out to purchase a new home, make sure the neighbourhood isn’t just desirable to you but has objective qualities—such as attractive amenities that will help ensure your investment appreciates over time.
KEY TAKEAWAYS
- Location is key to valuable real estate.
- Homes in cities that have little room for expansion tend to be more valuable than those in cities that have plenty of room.
- Consider the accessibility, appearance, and amenities of a neighbourhood as well as development plans.
- Land/Plot Size often trumps the quality of a house because land tends to increase in value.
Iris Courts by Afriland Properties is currently selling in Aromire, Ikeja. Located 7 minutes from the principal district of Alausa, Iris Courts by Afriland is strategically located to offer you great value on your investment.
Our expert team of architects have conceptualised a modern design that makes this real estate project, the choice place for work and for life.
Contact us today to own a unit in this prime real estate asset with tastefully designed 1bedroom, 2bedroom and 3bedroom flats available for residential or short-let purposes.
Save up to N10m by taking advantage of our pre-sales offer.
Contact us today on our sales hotlines:
09166073000
09166074000
or email us at
sales@afrilandproperties.com
