I was working on a BPO (broker price opinion) the other day and as I was doing my inspection I realized again the importance of location on the value of a home. The home is in move-in condition, built in the 60’s, but with some modern updating. It’s a large single story with huge kitchen along with large living area and bedrooms. It also offers a large corner lot with in-ground pool. From the description of the home, you would expect it to have buyers knocking down the door to buy it. Before previewing the home, I assumed there must be some issues with the structure and the price was too high for its condition. When I got to the home, I realized it’s less than desirable location on a main street into town on a busy corner lot. It’s proximity to commercial businesses doesn’t help much either.
What is a seller to do when they have maintained their home and its features are what many home buyers are looking for, but the placement of the home is poor, leaving the home owner with limited buyers to pursue the property? You can’t change the location of the home and putting more money into a home that doesn’t need it won’t be profitable either. The only true option for the home owner is to drop the price to compensate for its poor location. This isn’t music to a home seller’s ears, but if you have to sell your home, this may be the only option.
The same rings true for home buyers looking to purchase. If you love the home, but not the location, you can attempt to negotiate the price, but assume that you will be in the same situation when you go to sell the home so take that into consideration when you make your offer. Location is a large part of what home buyers use when deciding on a home to buy. Whether it’s to find a home in a desirable school district/neighborhood or avoiding a busy street due to traffic noise or child safety, that will always affect its market value in a positive or negative way.
