This morning I mentioned about the 5 Location Keys. I thought I should expand on them for you.
- Shops
- Schools
- Transport
- Café’s
- Demand over Supply
When considering a property purchase you will put different weights on each of these depending upon your motives, your price point and your target market. For example a property near a university may be targeted for a student so the question of nearby schools for the children of tenants would obviously not be as important as Shops, Transport, or Café’s.
Key no. 5 requires a little explanation. Demand over Supply looks at the relative demand for property over the available supply and how that could possibly change into the future. If you were to buy in an area where there is a lot of land to be developed in the future years then this may impact on your capital growth as the supply of new stock is higher than for existing properties being re-sold.
In these areas you may need to consider the length of time you would need to hold this property to achieve a comparative level of capital growth.
When I talk to my investment clients I discuss how the property measures up in these key areas and how it meets the clients’ objectives. Ian Franklin
