Timing is more important than location in determining the value of a property?

…you state that timing is more important than location in determining the value of a property. I don’t buy that. A property located on the Westside is more valuable than one on the Eastside, so location is more important.

Owner Asked on September 10, 2019 in Real Estate.
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Of course, a waterfront location at False Creek is more valuable than a lot on Stuart Lake. That’s not the point. Everyone trumpets the location, location, location answer as the panacea to real estate investment yet the average person would have been far better served by observing timing and trends. Downtown condos at False Creek from 1992 to 1997 dropped by up to 35% in value at the finest location, while a building lot in Surrey rose from $65,000 to $130,000. Buying a home ANYWHERE in Toronto, New York or San Diego in 1986 and selling it in 1989 would have made you 60% profit, buying the same home anywhere in these markets in 1989 and selling it in 1994 would have lost you 35%…buying it back in 1994 and selling in 2000…up again by 45%. More recently buying a home anywhere in the US in 2004 would have seen a 32% profit by 2006. Then the loss was over 60% by 2011. If you bought in the US in 2012 (when I urged people to buy Phoenix and organized bus tours there) you saw a 200 – 300% increase…Not to waste your time talking about Vancouver, up to 2008 – down to 2010- soaring to 2017 …down till now…etc.

Real estate markets – unlike stock markets – are always local in nature and thus fluctuate with the confidence level of the buyers in a given market. There are a half dozen times, where you could have bought on the Westside and seen values come off substantially. ‘Location’ did not help the loss in value. When I argued in 1995 to go into Toronto, in 1996 into Calgary and back into the Lower Mainland BC and the US since 2012, it did not really matter what location you bought – you made money in ANY location as you were at the right time in the cycle. (The most unreported inflation of all-time cycle.) Yes, and I did write the book “Forget About Location, Location, Location” in 1998.)

Guru Answered on September 10, 2019.
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