Myles of Investments

Read about my successes and failures. Learn from my experiences and gain insight without losing any cash!!!

Lesson: Catching a Falling Knife
Lesson: Currency Exchange
Lesson: Mutual Fund
Lesson: Paid to Wait
Lesson: Pricing in a Downturn

This is where you’ll find find my Blog. I will comment on the latest news relating to investing, real estate, and the financial markets.

Location Strategies for Real Estate

When considering location strategies for the purchase of real estate, take into account the following considerations in order to maximize growth on assets purchased in prime areas over getting mediocre results.

Is the city of purchase desirable overall, and is the population growing not stagnating? Do your friends talk about wanting to move there or live there someday if they could afford it – this is a good sign that the area has positive connotations.

Look downtown, if the city has a growing or thriving downtown, people will pay a premium to be where the action is. This is especially true of first time home buyers who are young, or for rental units aimed at young professionals. A nice area close to nightlife is the key.

Does your property have a million dollar view? Are you near water? This may sound odd, but the closer you are to bodies of water, the better the location as typically houses with a lake view are astronomically high, and the surrounding areas taper down. Even though people don’t have a view of the water the premium is still relatively set for the area. This also works for forest vistas, mountain views and elevated urban views. Even though people have no physical use for the view, the feeling of space ownership beyond the property is immense to the point of enlarging the perception of space in the property.

Are there a lot of renovations going on? People buying in moderate areas to either tear down, add on or spend money to fix up, signal that this is the next transition area, and will eventually be filled with opulent houses in the next decade. Location strategies with this in mind take advantage of the next nicest neighborhood to the nicest neighborhoods.

Is the property close to both public transit and major highway / route connectors. Public transit is critical for renters and in dense urban areas where people will pay a premium for this. Commuters and working families will want easy access to services and major highway routes to ease commuting time.

Is the location family friendly? Good schools are critical, along with things like low traffic or dead end streets while still being in a desired area.

Location strategies should not omit local upgrades. This can be a boon, because the city is literally planning to increase the value of certain areas over others. Downtown revitalizations, new public facility construction like libraries and arenas and transit line extensions can open up an entire area that was before thought to be less desirable. Check into city websites and plans, as typically if a large local upgrade is occurring it will be easy to find as the city also wants to promote these areas as desirable.

Our location strategies can be summed up by our actual first home purchase: We bought in a quiet, safe, bedroom community with good schools, and were very picky about the location. We purchased in the downtown core, with a large lot when the city had announced the funding of a major downtown and waterfront revitalization project. Even though preliminary construction had started, the values had not increased yet because no one could see the physical results yet. We were able to obtain on the order of $50,000 increase in the value of our property by adhering to the location strategies outlined above.