Realtors are always discussing this and emphasizing the importance of how it factors into the value of a home. How much truth is there in what they are saying and should you really believe all the hype?
Some Realtors will say that location is much more important than the actual home. Buying a smaller home that might need some updating in a more desirable neighborhood might be a much better investment than the larger newer home in a much less desirable location. I would agree with this on most occasions because purchasing a home is an investment.
The investment of a home is both a personal and business decision. This is where many buyers (and sellers) tend to struggle and keep it more on the personal side. It should be personal, after all you will be living there, but buying the perfect home in a bad location can be a recipe for both financial disaster and perhaps a lousy personal experience.
You can always add to your investment by doing renovations, additions and other improvements. These all cost money, but the question you should be asking is "What am I going to get in return on this investment down the road?" Not always an easy question to answer, but you should be able to come up with some close numbers. Add all you want to house in a bad location and your ROI (Return On Investment) is not going to look very good. While you can change the size of your house, the garage, or add a pool, you can never really change the location.
That all said, what if you find the absolutely perfect home in not the greatest of locations. If you don't care about making money on the home, and actually likely losing money on it when you sell, then perhaps you should go for it. Also remember it will likely take much longer to sell because you are limiting yourself to a very small pool of buyers. Location is very important, but it is not the end all be all for some people. Location is definitely something you want to keep in mind when purchasing any type of a property.
Matt Trudel is the owner of Five Star Realty in Windham