Whereas, a little one bedroom, one bath shack sitting in the middle of downtown Dallas would be worth a lot of money or profit in returns. So you can see that the location is of the utmost importance when you are considering a piece of real estate to invest in.
What is it that makes the location of a piece of real estate valuable? The answer is fairly simply really. The value is based on nothing more than the desirability factor. Desirability (in terms of so many things) is a fluctuating intangible that is really hard to understand.
Property that is totally unwanted by one person may be just another person's desires. And this phenomenon is true for real estate investors and for home buyers and for renters. It is true for all aspects of the real estate market.
For any real estate investor, who is looking to making huge profit in returns, The main point for such and one should consider firstly, is what their strategy will be for making a profit on a property. Buying is only half of the equation and whether the location of the property is good or bad depends upon that profit strategy. In other words, buying any property with the focus of making profit is not the problem, but what really is, is the profitability that can occur as a result of the location of a property.
For instance: If an investor in Nigeria want to invest in a property with the intention of just waiting for the market to go up, a Logas State real estate is probably the very best choice. Locations that are near entertainment centers, Centre of commerce, or developing areas would be the best because the likely hood that the property will increase in value simply by waiting is guaranteed.
In addition, if an investor is going to invest in a property with the intention of renting it and making a monthly income from it, he might be better off to look into urban properties. Urban properties wouldn't be considered prime real estate but they are prime rental properties.
Then there are real estate investors who are handy with their hands. They can make repairs and renovations to rundown properties themselves, sell it for a great deal more than their purchase price and make a very nice profit (the process we called Flipping business). The location that these kinds of real estate investors often find the best is in neighborhoods that are made up of mid priced homes in working neighborhoods.
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There are many factors that real estate investors consider when they are deciding which property to invest in. One factor can be what I call the snob factor. The very fact that, investors will pay more money for a very small property in an advance area whereas a big property in another neighborhood that is not attractive will receive a very small bid. That's because one persons definition of a good neighborhood will not be anywhere close to another persons definition of a good neighborhood. |
visibility is yet another factor: If a neighborhood or an area has become famous or even infamous, property values rise regardless of the location. Convenience is another factor when considering the desirability of the location of a piece of property. People do like to live close to where they work and where their children attend school. Rising gas prices just might work wonders for real estate prices in inner cities.
The desirability of the location of any piece of real estate can be determined by a great many different factors for real estate investors and for home buyers and renters. If the location is desirable for the investors purposes he will invest.
If the location is desirable for a home buyers purposes then he will buy. If the location is desirable for a renters purposes then he will rent. So basically, you can roll all of the various factors for determining whether a location is good or bad into one simple work; desirability.
We are a nation of individuals. We all see things from a different point of view. Look around. There are people living everywhere. They live in big cities, small towns and in urban and rural areas. Who can determine what a good location really is?
There is a proverb that says, Beauty is in the eye of the beholder. The modern version would be whatever floats your boat is good. In real estate it would translate to if the location serves your purpose then its a good location.
In summary, your desirability to achieve maximum success in your real estate investing in Nigeria lies in so many things, but maximally in getting the location factor right.
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References: www.financeequityloans.com
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