”Location, location, location” might be a cliche, but it holds important meaning for homebuyers.
Location, location, location is probably the most well-known phrase in real estate.
But while some property jargon can be murky, these words on the importance of location couldn’t ring truer.
As the experts explain, finding a well-positioned property is vital not just for lifestyle, but for long-term value too.
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BREAKING IT DOWN
While “location, location, location” might be an “old cliche” it holds important meaning, according to WBP Group chief executive Greville Pabst.
He said the phrase could break down a great location into three levels — the suburb, the street and the position of the property itself — and each was equally important.
“Just because you’ve got the first location right doesn’t mean you’ve made it,” Mr Pabst said.
Advantage Property Consulting director Frank Valentic said location was a golden rule of real estate and mattered because unlike a home’s condition, it was permanent: “You can change a property, but not its location.”
Choosing which suburb to buy in is only one element of a great location — there’s more to it.
LOCATION ONE — THE SUBURB
Assessing a suburb and what it offered is the first step to a great location.
A thriving local village with shops, cafes and services was becoming an essential for many buyers, Nicole Jacobs Property director Nicole Jacobs said: “We have our big shopping centres, but people are really being drawn back to their strip shops and villages.
“And it doesn’t have to be a prestige suburb for that to occur.”
A local village with shops, cafes and transport is one factor to look for in a suburb.
Mr Pabst agreed closeness to a village with “lifestyle attributes” was a major factor driving property prices.
“In the same suburb, the difference in value can be 10-15 per cent, depending on whether or not you can walk down the street to a restaurant and shops and then walk home, as opposed to driving to a restaurant,” he said.
Mr Valentic said an area’s “walkability” was a key attraction to buyers, and websites such as walkscore.com could help to gauge how easy it was to get around a suburb by foot or public transport.
“High walk scores and transit scores usually translate to higher capital growth,” he added.
WBP Group chief executive Greville Pabst said having shops and cafes in walking distance could make a 10-15 per cent difference in a property’s value.
Transport, particularly a train line, was a key requirement, especially in suburbs further from the city, Ms Jacobs said.
And with townhouse and apartment living on the rise, parks and outdoor spaces were becoming an increasingly important location element.
For families, schools were another location must-have and there was often tough competition.
Ms Jacobs said parents set sights on popular high school zones when their children were young, and homes in some in-demand public catchments attracted competition and a 10-15 per cent premium on prices.
She noted looking at future plans for a suburb was also crucial.
It was imperative buyers did due diligence by looking at proposals and plans for infrastructure or development that were before the local council.
Buyers are also advised to also check the area’s zoning and overlays.
“What could happen — is it a future development site? Always investigate the zoning,” Mr Pabst said.
Parks and open spaces are another drawcard to look for.
LOCATION TWO — THE STREET
Getting the suburb right was one step, but a good street is considered just as important.
“In South Yarra as an example, there may be only 10 or 12 streets I would by in,” Mr Pabst said, adding some stretches were too close to the train line, others were too narrow or one-way, and some were overshadowed by high-density development.
“There are always certain streets (that) will outperform other streets.”
An ideal one might be wide, tree-lined, have a consistent or attractive streetscape, little through traffic and be easy to access.
The position of the house in the street was another consideration.
Some buyers saw a corner block as having potential to subdivide down the track, while others viewed two street frontages as a downside, Mr Valentic said.
A busy main road, T-intersection, freeway and petrol or train station weren’t ideal neighbours, he noted.
Being close to a train station is important — but not so close that you can’t block out the noise of boom gates clanging.
While having amenities close was a drawcard, beingtoo close was a downside.
“I don’t want to be right next door to that pub or nightclub or commercial activity — I want to walk down to it and enjoy it but not be impacted adversely by noise, smell or traffic,” Mr Pabst said.
It was also important to buy on the right side of the street, with properties boasting north-facing backyards more sought-after and likely to perform better.
“Generally the design of homes now is having a living room at the back and you want natural light coming in where you spend most of your time,” Mr Pabst said.
Ms Jacobs said visiting a street multiple times could reveal issues with traffic, noise and even light.
Nicole Jacobs Property director Nicole Jacobs said visiting a location at different times of day and speaking to locals could help buyers get a better understanding of it.
LOCATION THREE — THE PROPERTY
The third element of a good location is the position of the dwelling itself.
Mr Pabst said it was important to judge how apartments or units were set in a block.
“Even though you are in the same block, all of those flats will perform differently,” he said.
“A top-floor front apartment is going to perform better than a ground-floor back apartment that gets headlights shining in or is close to the bins.”
Upstairs apartments could also offer better views, light and security, while ground floor options could come with a courtyard, meaning more land value.
Advantage Property director Frank Valentic said while poorly located properties might be cheap now, they would remain cheap — and harder to sell down the track.
The way a house was set on a block of land could also make a difference.
“If a house is well positioned on that block of land, it can feel so much bigger,” Ms Jacobs said.
Mr Valentic added a large front yard might be less usable than a large backyard.
WHY IT MATTERS
A great location is key to any property worth investing in.
“If a property doesn’t meet the location criteria, we don’t call it investment quality,” Mr Valentic said.
But buyers seeking a family home should also aim for these fundamentals.
“Properties that tick those boxes will give you the lifestyle,” he said.
“You can have the best of both worlds in that if you’re living there you can enjoy it all, and there’s going to be the benefit of capital growth.”
On the other hand, a poorly positioned property might be cheap to buy now, but would be harder to sell or rent out down the track.
Great location doesn’t have to mean blue-chip inner-city suburbs — many of these principles applied almost anywhere.
“If you can’t go for a location you really want, look at the next periphery suburb,” Ms Jacobs said.
Mr Valentic said buyers should look for signs of gentrification and improving amenities if they were househunting further from the city.
And while the inner suburbs had benefited from strong capital gains, there was still growth left in outer areas.
Getting to know an unfamiliar area was critical before buying, Ms Jacobs said: “Speak to neighbours, go to cafes and speak to people about what makes an area or a street a good one.”