25 July 2023
Location is often the first factor we review when choosing where to buy a home. Select an appropriate area for your budget, lifestyle and goals and you'll enjoy a sense of security and financial stability while establishing roots in a community your family thrives in. Select the wrong area for your unique needs and you could experience time-consuming commutes, increased stress levels and feelings of isolation and dissatisfaction.
With the average home loan period extending several years, moving into a home in the wrong neighbourhood will be costly and time-consuming, so you want to avoid making this error. Anticipating and understanding your needs is the first step towards preventing buyer's remorse — and will help you recoup your investment if you sell the property later. Here's why the right location matters and what factors should go into your decision.
Most people looking for a home are aware of major red flags that indicate a neighbourhood is worth avoiding. These red flags could include a high crime rate, a lack of infrastructure and the absence of local amenities. While these factors are critical, they aren't the only ones you should consider. What makes an area perfect for one person might make it inappropriate for another.
Because you'll need to live in your chosen area for the next few years at the minimum, you should consider your personal goals and whether they align with what your chosen neighbourhood can offer. Depending on what stage of life you're in, this could mean making short-term sacrifices for long-term gains. For example, a young newlywed who plans on starting a family may pass over a neighbourhood with a vibrant nightlife scene for one with access to good schools and parks. A single person planning to relocate abroad in the next decade may choose to forgo access to amenities for a property with a high estimated resale value.
Here are a few factors that you can consider to narrow down which neighbourhood you choose to live in:
Selecting a property to live in requires you to evaluate different qualities compared to a property you'll rent out. The latter requires you to select an area with properties that have historically experienced growth in value and are predicted to do so in future. You'll also need to consider the demand for and average rental rates of local properties to determine how easily or quickly you can recoup your investment. If you purchase a sectional title property, you should investigate your obligations concerning the property's upkeep and its tenant onboarding and eviction process.
All properties come with ongoing costs you'll pay monthly or annually. It's important to determine what costs you can expect to pay before committing to an area as you could find that an otherwise affordable property isn't that affordable after all. Ongoing costs include rates and levies as well as utilities like water and electricity. You may also encounter added costs with sectional title estates and complexes such as property and home insurance, maintenance and security costs. For example, areas with high crime rates may require a security investment while older or historical homes may require complex or costly insurance.
Having a safe home involves more than choosing an area with low crime rates. How the neighbourhood proactively prevents or addresses crime and the presence of police or security agencies can also play an important role. Look for the presence of a local neighbourhood watch committee to determine the frequency and nature of the local crime and if the police attend to calls timeously and are able to recover stolen items.
An accessible neighbourhood is one where you can easily enter and exit without spending hours in traffic or being limited to a single road or highway in and out of the area. It's worth noting if the roads are well maintained, adequately lit and safe to drive on during poor weather or limited visibility. It's also worth noting if the area has a robust public transport system that's reliable and passes through business or central districts outside the neighbourhood.
An area that allows you to live the lifestyle of your choice is invaluable. For families, this can mean a neighbourhood that's quiet, walkable and feeds into prestigious preschools, primary schools and high schools. It should also have family-friendly amenities such as libraries, sports fields and swimming pools. If you lead an entertainer's lifestyle you'll want an area that doesn't restrict noise levels or is close to social hotspots. It should also allow you easy access to ride-sharing services and 24-hour shops, laundromats and more.
The health and future of a neighbourhood will keep your home's market value high and ensure you enjoy the neighbourhood for years to come. You may want to choose an area that's set to become popular or is currently undergoing development so you can secure the property at a lower price and watch its value skyrocket. Neighbourhoods worth watching are likely to develop improved transport systems, sights and attractions and other highlights that make a neighbourhood desirable to live in.
Many factors will go into choosing the ideal neighbourhood for your needs and this isn't a decision you should rush into. You should start considering your choices as early in the process as possible when you begin to apply for home loans. SA Home Loans are experts in assisting South Africans through the property ownership process and can help address any questions you have about picking a suitable neighbourhood and property. To get started on the process, contact our team on 0860 2 4 6 8 10 or complete our Call me back form and we'll be in touch.