Location, location, location. Whenever you talk to an agent regarding property values, location is one crucial factor that can never be ignored. This mantra means that the value of a property can greatly vary because of its location.
When determining the value of properties, appraisers always take location into consideration. Locations can have a low or high value due to a number of vital reasons.
High Value Locations
Generally, locations that are in demand but less in supply have higher values. They are highly in demand because of the following reasons:
Houses that offer great views have a higher value such as those near the mountains, or near the ocean, lakes, and rivers; or houses with a scenic view of the city skyline. Homes near parks also have a higher cost because the location offers recreational opportunities outdoors.
In several places, you can also find properties close to entertainment centres such as golf courses and movie theatres that are costlier than those sited further.
Similarly, homebuyers who have kids are often more concerned with their education. Reasonably, they are willing to pay more for a property situated within a school district with good reputation.
Likewise, areas that have proven to weather economic recessions over time have more stable property values.
Low Value Locations
On the other hand, locations that have low demand but high supply have lower values. What factors make the value of a property lower?
Residential homes that are near commercial buildings can adversely affect its real estate value. This is because traffic, noise and other commercial activities can be cited as problems for homeowners. Home values can also get affected depending on the types of commercial buildings. For instance, retail stores can cause home values to increase after its construction. However, property values can drop while construction is on-going.
Houses near busy intersections, airports, and railroads can also lower home values since it may cause disturbances to homeowners.
Areas with high crime rates usually reduces property values.
Locations that are prone to hazardous conditions can also lower its value such as those near factories with toxic emissions.
Remember that Locations Change
When you find a property in an ideal location with a seemingly perfect price tag, it won’t hurt to contemplate on other factors that could impact that property sooner or later. Find out if there are vacant lands that developers are planning to develop in the future. Because, for instance, if there is a vacant area near the house you bought and after some time, the developers construct apartment buildings at that area, it will change the entire landscape obstructing the scenic views, which could result to a lower value of your property.
So, is location still the question? It is and always will be. Definitely, location is a crucial factor that one must prioritize when investing on a property.
If you are planning to purchase a home and ensure that it will be a good investment in the future, visit Dubai Property Festival, one of the largest real estate platforms in the Middle East, that offers the best property deals in the market. Organized by the Dubai Land Department, you can enjoy exclusive deals with low interest rates from top real estate developers.