Good Home Bad Area, Bad Home Good Area: What’s better?


As much as a property investment can be incredibly rewarding, the importance of getting the right property to invest in cannot be stressed enough. A good manageable property will get you the results you are after, plus more. A bad property on the other hand can be a cause for great regret. This is why it’s important to make sure you get it right in the first place.

A quality home in an average area and an average home in a quality area can sometimes cost nearly the same amount of money. Many investors find themselves wondering which of the two investments would be better, and understandably so.

At face value, this is a perplexing question to be contemplating. You’ll find that property agents will try to tell you that you should always try and get an average house in a quality area. This is based on the belief that it’s the land that matters in the end. Not so much the house itself. Such a suggestion may hold some merit if the average house required a bit of renovation in order to uplift its value.  This isn’t always the case because not all average properties have the potential to be renovated and turned into quality properties.

When making a decision, you will want to consider a range of factors. For starters, make sure that the owner of the property isn’t trying to charge you an unreasonably high amount. Like a rugged property simply because it’s in a good neighbourhood.

You want to be sure that the total area of the land in question isn’t considerably smaller than the norm for a particular neighbourhood. Also that it’s not architecturally inconsistent with the rest of the houses. It is equally vital to ensure that your average property in a quality neighbourhood isn’t at the bottom of a slope, next to a block of units or at the corner of two busy streets.

Each of these factors can be majorly disincentivising from the point of view of prospective tenants. Besides, you want to think resale in some years down the track as well!

The worse the investment property at the onset, the worse it will get with time which then makes it harder to facilitate future renovations. Unless of course you want to knock it down altogether and build over it from scratch. We’re talking about a quality house in a quality area, which won’t happen unless you’re prepared to fork out big bucks. We’re talking about an investment that costs less and earns more, so need to be careful from the start.

Now, to consider the inverse option. Let’s talk about getting a quality home in an average area. This one is a much easier proposition to think about. It is because nine out of ten, you wouldn’t want to buy a good house in a bad neighbourhood. It’s like having a mansion in the middle of an area that may have crime or hygiene issues, an area that’s too far from amenities, or an area that’s too busy or too noisy.

No doubt, there can be exceptions but all in all, an average property in a quality area is still a better investment than a quality property in an average area.

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