Most prospective home buyers have heard the old adage that the three most important factors to consider when buying real estate are "location, location, location." In reality, although location is important, there is much more to consider in any real estate transaction, which is why most home buyers and sellers choose to work with real estate professionals.
Just how important is location? A National Association of REALTORS® (NAR) survey found although affordability ranks high in importance, buyers' focus on neighborhood, distance from work, access to shopping and schools demonstrate location is indeed significant.
"People who have bought real estate, especially those who have had a number of transactions, are aware of the value of location," Leannah Hunt, president of the Silicon Valley Association of REALTORS®, says. "However, first time home buyers should be careful to choose a location that meets their needs, even if it means paying a little more. A bargain found in a less-than-advantageous location might look to be a good deal, but its chances for resale may be lower."
The NAR survey found value of location is unique to the buyer interests. Home buyers with growing families are likely to look for a neighborhood with close proximity to work and schools. Retired home buyers consider availability of shopping a higher priority the survey shows.
"Neighborhoods are key to the type of environment the buyer is searching for," Hunt explains. "For example, neighborhoods surrounding elementary schools tend to attract families with young children. This won't necessarily change, since families whose children are now grown find other locations more convenient and are apt to sell, creating sufficient turnover for new families with younger children."
Buyers who own two cars also tend to rank closeness to schools higher than nearby shopping, work and other factors such as public transportation, churches and recreational facilities.
Hunt, who is a Realtor with Coldwell Banker in Palo Alto, said that's why demand for housing is high in Silicon Valley. "Silicon Valley has a healthy economy and its communities have good schools and proximity to shopping, the arts and entertainment," said Hunt.
"It's important for potential buyers to examine what ranks high on their own list of priorities before they begin the house hunting process," Hunt says. "In that way, they'll have a clear idea of what amenities and services are available in the community they want to join."
The value of a house can change after its purchase. However, any change is likely to be gradual and will depend on factors such as the age of home. Older neighborhoods tend to change more gradually. Houses located near an institution, such as an elementary school, are usually a good investment since their worth is related to a factor that is long-lasting, in this case, the school. In some cases, a buyer may want to sacrifice an asset such as close proximity to a school if a larger house further away is more affordable.
"The whole subject of location is a personal choice for the buyer," said Hunt. "That's why a real estate professional will interview the buyer to determine his or her interests, priorities and financial position in order to select a range of possible homes to show."
The Silicon Valley Association of REALTORS® is one of more than 1,800 local boards and associations nationwide that comprise the National Association of REALTORS®. To find a Realtor in your area, visit www.silvar.org.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.