Good Location Bad Property

We’ve looked at good property in a bad area, now what about bad property in a good area? This may be your best bet when it comes to trying to make money in a highly desirable area.  Buying a good property that may be brand new or newly renovated in a hot part of town will cost you a lot –there’s no question about it. But if you happen to get the chance to purchase an old property in bad condition in a good area it will be cheaper –but quite often not always that much cheaper. If someone has a foot in a good neighborhood they know it and won’t let the property go for cheap. As already mentioned, the golden rule is that you can change your property but not your location.

Nevertheless, someone may be selling an old home that needs complete renovation or even a teardown that will require a new home to be built. Very often old warehouses and storage spaces get converted into trendy lofts and sell due to unique and desirable features such as very high ceilings on a desirable location close to a developed port district.  You must factor in the cost and time it will take to renovate or build new property in that location.

If you add the price of work with the cost of what you paid for the property and you believe you can still get a high return on the investment when it comes time to sell a good property in a good location then it’s worth your while. If not, don’t bother. Be sure to avoid the situation where you buy in a good area but while investing in renovation work the desirability of the area changes from good to bad. Then you’ll be stuck with a new and expensive home that will be impossible to sell. This is a sure way to lose in your original investment.