Here’s why buyers can hate a home and still buy it
It is always better to put location as a top priority and rather compromise on the property itself. This is because it is impossible to change a property’s location, while the home can be renovated or changed to meet the owner’s needs.
This is according to Adrian Goslett, regional director and CEO of RE/MAX of Southern Africa, who says many buyers focus on the home itself and compromise on its location, however in terms of the appreciation potential of the property this will end up hurting their back pocket.
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“A good location is where there is the potential for growth and development,” he says. “The area needs to be able to support the demand for property over the long term and subsequently increase the value of the property in time. However, it is important to bear in mind that certain development can bring down the value of a property, such as the construction of a power plant or dump within proximity to the home.
“Before purchasing in an area buyers should find out about the future development plans of an area. Developments such as new industrial sites, new roads or railways or even industrial activities can vastly alter the price profile of an area.”
Commercial activity and corporate investment in an area is also indication that an area has the potential for strong investment returns. The presence of residential and commercial property development, along with long-established or well-known brands within the surrounds, will indicate that there is a level of confidence that the area has good growth potential.
The infrastructure of an area will also have an impact on the value of the properties located there. “Neglected areas that experience poor service delivery are not a good option in which to invest,” says Goslett. “It is fairly easy to distinguish these areas based on the upkeep of the general public land such as the parks, pavements and roads.”
Proximity to quality amenities which include shopping and medical facilities, entertainment areas, restaurants, public services and schools needs to be considered, as does crime.
“Homes in an area with a high crime rate will not hold their value over time,” says Goslett. “Potential buyers will be able to find out about the crime rate in an area by contacting the local residents’ association, speaking to potential neighbours or consulting with the security companies that service the area. Driving through an area during different times of the day could indicate either unpleasant or welcome conditions. The different times could bring about a variety of elements such as how severe the traffic is during peak times or how lively and noisy the night life is.”
Accessibility to transport routes can also have an impact on an area’s appreciation potential due to many South Africans having to commute relatively far distances to work every day. “There is a fine balance to consider when selecting a property within proximity to major transport routes,” he says. “It is important to be within range, however being too close could expose the property to a significant amount of noise and have a negative impact on the home’s value.”