Savvy buyers look to location for resale value



If you've heard it once, you've heard it 1,000 times: The three most important elements in real estate are "location, location, location."

"You can have the most beautiful house in town, but if the setting isn't right, you can have a problem with resale," cautions Ruth Rejnis, the author of several books on real estate.

Savvy homebuyers focus heavily on locational elements in their real estate buying decisions, says Norman Flynn, a past president of the National Association of Realtors.

"A smaller house in a better neighborhood is likely to have stronger capital gains down the road than a bigger house in an inferior location," Mr. Flynn is convinced.

You may love a home for its open hearth fireplace, cherry wood kitchen cabinetry and sunken living room. Yet if the property you buy overlooks a major freeway, or borders a landfill, your choice could cost you money when you sell.

"You wouldn't buy a car with a great interior but fenders that were falling off. So why buy a nice house in a bad location?" Mr. Flynn asks.


R Here are pointers on location from real estate specialists:

* Consider buying in the path of future growth.

You may plan to live in your next house for many years. Still, in these days of slow appreciation (not to mention depreciation), you can't afford to be indifferent to questions about your home's future value.

One way to assure yourself that your home will likely gain in value is to buy in the path of future growth, advocates Peter G. Miller, the Silver Spring-based author of "Buy Your First Home Now," a HarperCollins paperback.

Look for a site near to a shopping mall under construction, near to where a new or improved highway is going in, or to where a major employer is planning to expand and bring new jobs, Mr. Miller says.

* Consider buying in a "magnet" area.

Some neighborhoods remain hot for sellers in all kinds of markets. They're known as magnet areas because they offer some hard-to-get situational advantage. If your personal plans allow you the choice of buying in such an area, you might consider doing so.

For example, a cluster of homes could be located in the immediate vicinity of a college that is short on student housing, on the border of a park or recreational facility that is highly valued, or on prime beachfront land.

"Even if the area is an architectural stew, people will make sacrifices to live near the beach," Ms. Rejnis says.

* Think trees and other greenery when you buy.

"We have tree-huggers everywhere. That's a universal," Mr. Flynn observes.

Not every community offers leafy vegetation. But even if you're indifferent to whether you live with greenery, you should think about the preferences of others when it's your time to sell.

* Think cul-de-sacs and kids.

Some residential neighborhoods offer gracious cul-de-sacs. They're a very attractive feature for people with small children, as well as many adults who like the freedom from traffic that a cul-de-sac affords.

"If I buy on a cul-de-sac, I know I'm not going to have any drag racing down the street," Mr. Miller says.

* Think yard size and privacy.

"People want lot size not so much for the purpose of grandeur, but for the purpose of physical distance and privacy," Mr. Miller contends.

While most Americans are turning away from enormous yards that impose maintenance requirements which chew up weekend time, they still prefer a minimum lot size which provides distance among households.

* Think parking space.

Is the neighborhood you're considering tucked in so tightly that both on-street and off-street parking is scarce for its residents? Then that could be a definite turn-off for your prospects when you sell.

You may have two subcompacts that fit neatly in your two-car garage. But the buyer you face in the future could have a house full of teen-agers who need space outside the garage to park their vehicles. And that could cost you a sale if parking is in short supply.

* Think transportation access.

In a mobile society in which commuting problems are worsening for many, a home's location relative to major arteries or mass transit can be of critical importance.

Of course, few people want to live right next to a noisy freeway where huge trucks with bad mufflers roar along in the middle of the night. Still, many buyers value relatively close access to important thoroughfares -- not to mention shopping areas, restaurants, recreational facilities and other amenities.

* Think public schools.

If you have no children -- or those you have are grown -- you may think the quality of the public schools in the neighborhood where you're buying is irrelevant. But it's hardly irrelevant to the investment potential of your property.

Once people thought it was enough to move into an area offering an overall school system of high quality. Now, as skepticism about the quality of public schools is broadening, people are looking at education on a school-by-school basis.

* Realize that no one property comes with all locational positives.

You can go nuts trying to factor in everything that you want in a home, as well as everything anybody else might want.

Do you place a higher value on access to a particular commuting route or on having a half-acre yard where you can turn up the volume on your stereo without drawing complaints from the neighbors? Is it more important that you be located near the "right" high school, or that you live in an area with lower property tax bills?

If, in the course of house-hunting, you find yourself torn between competing alternatives, it's wise to go back to the drawing board and rank your priorities, Ms. Rejnis suggests.

"The bottom line is that unless you're terribly, terribly wealthy, you can't have it all. You'll have to compromise on housing like

everything else in life," she says.

(Ellen James Martin is a columnist for The Sun.)

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