Location, Location, Location
By Jim Palmer Jr.

After traveling some distance from my office today to a remote location to do a visual walk through of a 10 acre parcel for a market analysis, I was impressed by the fact that it had a lot of strikes against it just because of its location.  Not only was it many miles from a town or services, but the access road was long and rough.  The further I drove down the access road, the more discouraging it became because most of the 5 and 10 acre parcels in the subdivision were cluttered with abandoned singlewide manufactured homes or old gutted travel trailers and each of those dilapidated dwellings were surrounded by mounds of debris and junk cars and old appliances.

This little field trip reminded me of how important location is at least for the resale of property.  Now before you think I’m looking down my nose at a certain classification of property or clientele, I would say that that there is a buyer for every property and I believe in the American Dream of property ownership for every person in every financial status.  But, location does dictate value in a very significant way. 

During the process of this market analysis, it will be important to compare apples to apples in terms of what the general aesthetics of that neighborhood is along with the consideration of distance.  With any luck, there will be sold comparables inside that exact neighborhood, but if not, it would be important to find comparables in a very similar neighborhood.
One strategy for this seller may be to offer owner finance terms, which may appeal to buyers who are more interested in easy terms than worried by a tougher location.  The fact that it borders State Land may also be a mitigating factor that might compensate for the negative aspects.  Maybe the buyer will be more interested in the privacy factor than the general aesthetics of the neighborhood? 

The old real estate axiom about how location makes all the difference, is probably true in terms of salability, or in other words, how big is the pool of potential buyers for any certain property and how long will it take to sell? How does an appraiser or broker assign value based on location?  That is certainly not an exact science and is up for interpretation.  That is why a Market Analysis is often referred to as a Brokers Price Opinion. There are obviously other important factors (besides location) to consider when assigning a value to any particular piece of property.