Why is the average price of a single-family home lower in Victoriaville than in Westmount? It’s location, location, location, the oft-repeated mantra of many a real estate broker. Location plays a key role when looking for property to buy. Let’s review why…
Why is location so important when buying a home?
A home’s location affects not only your quality of life, it also plays a key role in the long-term value of your investment. This decisive criterion will help you make a more informed choice when the time comes to buy a property.
A factor beyond your control
You can always renovate an outdated kitchen, replace a roof or even add another floor to a house. However, except in very rare situations, moving an entire home is not an option. You can’t change the area it’s in.
If you buy a dream home near train tracks or on the wrong side of the tracks as they say, the purchase price will surely be lower. It will still be lower when it comes time to sell and there won’t be anything you can do about it.
So you have carefully consider the location before making an offer to purchase and also consider the potential profitability of your real estate investment. A poorly located home can limit how much you’ll make and could make it harder to sell in the future.
Fluctuating home prices
The selling price of a new home is determined based on the land value, construction costs and level of profit anticipated by the promoter. In the case of an existing home, its value can be estimated by analyzing the price of comparable properties in the same area. Then, a lot like shares in a publicly traded company, its market value will fluctuate in reaction to similar transactions, external events and the balance between supply and demand.
Location plays a major role in these price fluctuations. Homes in sought-after or fast-developing neighbourhoods often see their values quickly rise. Proximity to good amenities, transportation and schools can attract more buyers and potential buyers, increasing demand for housing and thus overall house prices.
City influence
Location isn’t just about the neighbourhood. It also includes the urban area in which a home is found. Each has its pros and cons that have direct impacts on property value. For example, big cities like Montreal and Quebec City offer numerous services, have more access to jobs and cultural activities, which can justify higher real estate prices.
Municipal policies, quality of schools, safety, access to public transportation and even urbanization projects can have an impact on the value of your home. Before signing on the dotted line, it’s worthwhile to fully examine the area and research the municipality to ensure it ticks off all your boxes.
Good to know…
You know how important location is. Confia is an asset to rely on when you’re thinking about buying a home. By doing business with a broker recommended by Confia real estate agency, you gain access to their market knowledge. The person who will accompany you will take into account your specific criteria regarding location and suggest properties that match your expressed desires.
The 8 criteria of a good location
We’ve compiled some of the qualities that buyers want. Few locations have them all (unless you’re prepared to pay a steep price!) so this should give you an idea of what to look for. Your budget and lifestyle should also be considered.
1. Centrality
A central location has many advantages: less travel time, easy access to services, near commercial shopping areas, etc.
That would contribute to your quality of life as well as impact a home’s resale value. It’s inevitable that well placed lots are becoming few and far between. Properties tend to gain value in an urban setting where there is little room left for new builds. A home’s central location is both practical and likely to be an excellent long-term investment... but it’s a difficult criterion to check off our wish list!
2. Neighbourhood
An ideal location is usually thought to be in a well-maintained area, with parks and shopping close by, that boasts a low crime rate. In this sense, a safe environment gives you peace of mind.
Choice of neighbourhood will have an impact on your comfort level and most assuredly your happiness level too! You’re searching for a welcoming community with a friendly atmosphere so make sure to explore the surrounding area while out house hunting.
3. Future urban development plans
What’s the area around a location going to look like down the road? Do a little research online and with the local city’s planning department to find out what development projects are in the works, if any. Some projects could add value (construction of a new school, for example) while others might make the area less attractive.
Taking this criterion into consideration is essential to ensure your home purchase will still meet your expectations, despite potential changes to the surrounding area. By anticipating them, you'll be more at peace with your final decision.
4. Transportation
Having access to major roadways equals fast and efficient travel to key destinations like work, school and shopping malls. Check out the area around your desired property to identify how easy it will be to get there.
Alternatively, proximity to public transportation, such as the subway, commuter rail or bus, provides a convenient alternative to driving, reducing car ownership costs and sometimes travel times.
5. Access to public and private services
Properties within walking distance of a well-rated educational institution are sought after by young families. However, living too close to a school can be a deterrent for buyers who are worried about noise and increased traffic. It’s therefore a good idea to weigh the pros and cons according to your individual preferences and needs.
Access to other public services like parks, health centres, libraries and recreational facilities can also influence the location of your future home. Will these factors contribute to your personal satisfaction or not?
6. Near a body of water
If finding the ideal lot is becoming rare, finding one beside a lake or river is becoming even harder! These highly coveted locations allow you to enjoy water sports or relax by the water without leaving the privacy of your own home - a luxury worth its weight in gold.
In such a case, you add a new dimension to your daily life by surrounding yourself with a a pleasant, scenic setting. Keep in mind that living near water may include increased risks (flooding, spring runoff, etc.).
7. View
A location with a spectactular view of a park, mountain, waterway or iconic building adds significant value to a home and contributes to its attractiveness on the real estate market. This feature will satisfy those looking for a feeling of well-being and connection with nature. An unobstructed view can also increase the amount of natural light inside a house.
8. Resale potential
Thinking about the future and a home’s potential resale value should be more than just a fleeting thought in your considerations. So what factors offer better resale potential?
Developing or high-demand neighbourhood
Growing infrastructure
Areas well served by public transportation
Close to services and amenities
Steady increase in house prices
You can now see how everything is interrelated! These criteria determine the quality of a location and have a direct impact on a property’s resale value. Your real estate broker can keep you informed about local real estate market trends and economic factors that will affect demand and property prices in the future.
Confia real estate agency can accompany you
Confia’s real estate brokers are able to advise buyers on developing neighbourhoods thanks to their in-depth knowledge of the market, current trends and economic factors to be considered when buying a property.
They have access to exclusive data and analysis tools that help them provide valuable information that simplifies your decision-making. You benefit from solid support when you collaborate with a broker recommended by Confia real estate agency. The person you choose through the pairing service will support you through all stages of your project.
They can help you target the ideal location – one that really matches your needs – by identifying the pros and cons of places and properties you’re interested in. Take advantage of Confia’s service and rest easy knowing you’re in good hands. Peace of mind is an invaluable gift for you.
Lot before bricks and mortar
So there you have it: you need to review several aspects in your quest to find the perfect location for a future home. Always remember that the surrounding area can make all the difference.
Let’s say you found two homes with the same asking price. The first is spacious and in turnkey shape but located on a narrow lot. The second has smaller square footage and needs some repairs but comes with a large lot. Which one should you buy?
Having a bigger lot usually means more available options for future building improvements. However, it’s still important to consider a property’s location and the general area it’s in.
Most of the time, when searching for your dream home, it’s a wise idea to focus on the lot. Think about whether it has the potential for long-term growth and appreciation, far beyond its brick and mortar structure.
FAQ
How can I assess the quality of a neighbourhood?
Several criteria need to be taken into account to determine the quality of a neighbourhood, including proximity to services and public transportation. A broker recommended by Confia real estate agency is just the person to help you figure this out and they can also share local market trends. You’ll get a better idea about the property values in a particular area.
What does the expression Location, location, location mean?
We’ve all heard the expression: Location, location, location. It’s often cited in the real estate world to highlight how important location is when referring to the value of a home. It emphasizes the idea that a home's location can be more important than its individual features.