Vladislav Doronin, Aman Group owner, CEO and chairman, bought the company in 2014. Since acquiring the company, Mr Doronin has focussed on expanding the group’s pipeline and improving its existing offerings.
In addition to his role with Aman Group, Vladislav Doronin is also the CEO, founder and chairman of OKO Group, a leading US real estate development company. This article will look at the impact of location on property value, outlining key factors to weigh up in identifying a promising real estate investment option.
In a property boom, buyers will clamour for virtually any house that comes onto the market. As great as this is while it lasts, once the bubble bursts, homebuyers will become increasingly picky, particularly in terms of location, with properties falling outside of the most sought-after locales depreciating in a much higher rate.
Location is a critical factor for anyone considering purchasing a property. For example, homes in areas with little room left for expansion generally keep their value better than those in locations ripe for redevelopment and expansion.
Key factors for buyers to consider when weighing up locations include accessibility, local amenities, appearance and plans for redevelopment locally. While transport links are important, properties located in close proximity to busy roadways are often less desirable to buyers and therefore more difficult to sell. Also, acreage is an important factor, since land tends to increase in value.
Most people tend to focus on the house or apartment when weighing up a potential purchase. However, it is important to realise that when a person buys a property, they are also buying a plot of land.
The structure currently standing on that land may be remodelled or renovated, or even demolished and rebuilt, but one thing the buyer cannot change is the land upon which it is built or its surroundings. This fact is illustrated quite clearly with suburban homes, where the boundaries of the property are clearly delineated.
Where the buyer is purchasing an apartment in a city rather than a house in a suburb, they are investing in a particular location. Certain districts of a city may be a ‘good’ or ‘bad’ investment, in the same way a house’s neighbourhood may make it more or less attractive to buyers.
Therefore, with any type of real estate, location is a driving force behind a property’s value. The difference between a good and bad investment generally boils down to a simple case of supply and demand. In great locations, only a limited number of homes are available, driving up demand and creating a seller’s market.
A desirable location typically benefits from good transport links, as well as high-ranking schools and community involvement. It is important to keep in mind, however, that ‘good’ and ‘bad’ locations will not stay that way forever, with cities, towns and suburban communities constantly in flux and less desirable neighbourhoods transitioning to up-and-coming within the course of a few short years. A boost in the local economy, such as a major employer opening nearby, can have a big impact in terms of social mobility.
When home hunting, it is prudent for purchasers to pay attention to nearby amenities, such as grocery stores and entertainment. Buyers should also consider factors such as public transport links and roads, with increased amenities nearby typically improving a home’s value.
A property’s proximity to the centre of a town or city is likely to be a defining factor in terms of asking price. Land is a finite commodity, and in highly developed cities like London or San Francisco, where there is little room left for additional growth, sellers can command higher prices than those living in cities with plenty of room left for expansion.
The appeal of a particular neighbourhood is largely down to personal preference. However, truly great neighbourhoods typically have a few key things in common, namely appearance, amenities and accessibility. However, it is important to remember that choice of neighbourhood is also likely to impact the size of the property’s footprint, with land in the most desirable locations commanding premium prices.
For those investing in a luxury home, location is even more important, since the home’s location will not only impact the buyer’s daily life but also the ultimate value of the property. The bigger the outlay the more research the purchaser will need to undertake, comparing different neighbourhoods.
Even if the buyer’s dream home comes onto the market, it is crucial to ensure that the area surrounding their potential purchase is also of high calibre. Aspects to look into include types of neighbours, average home values and overall safety in the area. It is also sensible to investigate what amenities are available nearby, such as parks, restaurants, shops and schools, so that the buyer can determine whether the location is suitable for their lifestyle.
Whether bought as a family home or a buy-to-let, purchasing property is an investment. One of the most important considerations in buying real estate is location. After all, many aspects of a property may change over the years, but location is the one thing that will always stay the same.