19 Sep, 2023
Real Estate Investment Strategies

Importance of the Location in Property Investment

We are recently experiencing a technological revolution in the field of real estate and property investment. There is a growing dependence on technology and digital models to influence investment decisions. Consequently, there is a belief that digital marketing and technological advertising tools are the most decisive factors in successfully promoting a property. While this approach certainly provides valuable insights, its effectiveness ultimately relies on one main factor: the property’s location. This remains an undeniable truth. In fact, without a favorable location, even the most impressive data loses relevance when potential buyers or renters show no interest.

In this article, we will try to explain how important location’s role is to positively impact overall real estate investment returns.

Why Location matters?

The interplay of price and location is often crucial for an eventual property investment. Reflect on your top priority when making a purchase decision as a potential buyer. Certainly, the price is enticing, but the location holds greater importance.  Otherwise, the price of the property would be meaningless. In fact, the location profoundly influences every aspect of the transaction and the property itself. In other words, a prime location can significantly boost demand and allow for a higher selling price, whereas a less desirable location can diminish appeal and demand, impacting the property’s value. Yet, investing a little extra initially for a superior location may be necessary. It paves the way for numerous potentially lucrative opportunities ahead.

Location’s main factors to consider for property investment.

Access and connectivity

Opting for an ideal location for your property investment offers a notable advantage in terms of accessibility and convenience. Real estate in areas with excellent public transport connections, amenities, shopping centers, and schools tends to draw a greater demand from tenants, consequently elevating the potential for increased rental earnings. Properties with convenient access to major highways or proximity to public transport hubs are especially appealing to younger renters, many of whom do not possess vehicles. Given the common desire to reside near workplaces and recreational spots, properties in such well-connected areas tend to hold higher value.

Infrastructure

Adopting a forward-thinking perspective when evaluating the prospects of a real estate and property investment should be the core of your research when seeking the perfect location for your property. Seek out regions where significant investments are being made in infrastructure, highways, public transportation hubs, train stations, as well as shopping and leisure facilities. It’s important to look beyond current amenities and consider future prospects as well. Plans for upcoming schools, hospitals, public transportation, and other civic infrastructure can substantially boost property values in the area. Furthermore, commercial development is a key factor in increasing property values. When searching for a home, make an effort to research any planned public, commercial, or residential developments, and assess how these future additions may influence the desirability of the nearby areas.

Centrality

The choice of location within a city or town has a profound impact on the cost of a property investment. Many buyers prefer highly developed districts which makes property prices incredibly expensive compared to growing areas.  This preference comes generally from these districts’ “centrality”. However, investors sometimes forget that lands are finite resources. Therefore, highly developed are areas with limited room for growth. However, developing areas still have ample space for expansion which makes them more valuable in terms of investment return.

We admit that highly developed districts are perfect for buyers who will reside in their properties soon. Yet for real estate investment, areas with growth potential tend to hold higher value in the market. This highlights how location plays a critical role in shaping the fundamental economic principle of supply and demand within real estate.

Neighborhood

For a successful property investment, finding a neighborhood that’s safe and secure is of utmost importance. A secure neighborhood doesn’t just draw in a larger pool of potential tenants, but it also encourages existing tenants to renew their leases with confidence. Assessing crime rates and safety data for a specific area is vital in evaluating its potential. Delving into the neighborhood’s past and overall background provides valuable insights into the stability of the surrounding area.

Location versus property quality in Real estate investment

The significance of location in making well-informed decisions regarding property investments should be thoroughly evaluated. A superior property situated in an undesirable location won’t generate the same return on investment as a “bad” property in a prime location. In fact, Location trumps the quality of a property because lands tend to increase in value while quality needs maintenance to maintain. A low-quality property is an asset that can be enhanced with some updates and renovations. However, it is impossible to change the location of your property.

How to choose the best location for property investment in Istanbul?

To answer this question, you should first determine the purpose of the purchase. Whether it is for personal use, vacation, or real estate investment. This will influence the location decision that aligns with your expectations. For those who seek beneficial returns on property investment in Istanbul, they should pay attention to an important feature. In fact, they should always remember that Istanbul is a polycentric city where there are multiple centers of activity and business. Moreover, each center has its own economic hub and associated real estate demand. These centers may also have their own CBD areas.  Besides, emerging centers seem more advantageous in terms of revenue in property investment than main ones. They also reduce the traffic issue by still being close to the important institutions.

Moreover, there is another important feature to take into consideration while choosing a location for real estate investment in Istanbul. You should know that Istanbul is growing to the North for many reasons, mainly the prevention of eventual earthquake damage. In fact, examination of data from 2006 indicates that the city is expanding in the northern, western, and northwestern directions. These findings provide evidence for urban expansion, promoting a multi-centered development pattern at various levels within the city.  Therefore, those who seek a beneficial real estate investment should opt for emerging locations in that axis such as Bahçeşehir.

Take a look at our project in New Bahçeşehir. 

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