It is a well-known fact that location is one of the most important elements in the value of a property in Grand Bahama and anywhere in the world. Let's take that one step further.
A good investment buy would be a sound property in an area that will increase in value in the future. Buying into an area that is strongly on the comeback is one way of having a successful real estate investment.
Trend is everything. The trick is to get in so that you are one of the earliest pioneers such as the lucky investors who bought on Spanish Main or in Fortune Bay Canal in the early days. It is of course safer to buy into an area after the restoration trend is unmistakably established.
What are some of the factors to consider when evaluating properties as good investments? A neighbourhood that is a good candidate for restoration must have a location advantage such-as canal, gated community, good location and also good basic homes.
Some neighbourhoods have a certain distinction that attracts buyers, but there are other factors to take into account. A house in a good location may have a few points subtracted if it is located on a busy street. Houses located on busy streets may represent some of the best buys in terms of space and amenities for the price.
However, some buyers who are very sensitive to noise or concerned about small children or pets may automaticil1ly rule out houses that are located on busy residential streets.
Other buyers don't share these same concerns, and will find many benefits to a house in these types of locations. Another factor to consider - if the sellers have made pricing concessions on the property based on its location, then you may have to pass on a similar price break to the next owner.
There are some buyers who would like to be close to schools, shopping and churches, but don't want to live across the street from these facilities, or may want an easy commute to their job, but would not consider a location close to the main road.
As you balance all of the factors, remember that a location liability which gets you a great house at a reasonable price will probably require you to pass a similar savings on to future buyers.
Traditionally, there is a strong correlation between consumer confidence and real estate sales activity. Currently, many consumers feel that the safest, most steady place to invest your money is in real estate.
Based on Enron and World Com this is not very surprising. Investors say that homes have durable benefits, which have little to do, with market cycles. Therefore, almost anytime is a good time to buy a home. Homes provide their owners with a significant hedge against inflation.
As a tangible asset, houses have tended to appreciate most rapidly when inflation flares up. Even if inflation remains low, a house can still serve as an important means of wealth building, as equity grows with the monthly mortgage payments.
Paying for a home also enhances the buyer's credit standing and secures an asset that can used later to finance business ventures, children's college tuition, or retirement.
And while it may be argued that paper investments, such as mutual funds, never have to be painted, insulated, or protected from fire or weather, you cannot live in them either! Good luck to everyone in finding a winner i n real estate. Until next week....
James Sarles – Let’s Talk Real Estate:
President of Coldwell Banker James Sarles Realty; an Estate Agent specializing in high-end luxury ocean-front and canal properties. James has a BS in Business and Psychology, and a background in marketing and advertising. He was born in Buffalo, New York and first came to The Bahamas when Tourism asked for his marketing assistance. He met his wife on that trip and still resides in Freeport today with their teen age son.
James is very involved in community; an active Sunrise Rotary member, as well as helps with many other charity groups on Grand Bahama. He is the founder of a Big Brother program for orphans or trouble teens through his Rotary Club, of which he is still active today. He can be reached at
james@sarlesrealty.com
