Geography
Many people who think about geography think about what they learned in high
school... rock formations, land masses, etc. Few people use geography to give
them an edge in real estate investing.
Typically, supply and demand drives real estate prices throughout the world. So
what drives supply and demand? There are many factors, but some of the
geographical ones can include:
- warm climate
- near rivers or oceans
- beautiful views
How does this give us an edge? Let's look at these geographical elements on a few levels:
Country Level
Although we are concentrating our investing in Canada, there are many other
countries throughout the world whose geography helps create a desirable living
environment. Some examples include Greece, Italy, and Australia.
Province or State Level
Which province is more likely to have mild temperatures year round - Manitoba
or British Columbia? The answer is obvious... The Rocky Mountains have a
tremendous effect on the climate in British Columbia, making the temperatures
mild year round in some areas, and they also provide breathtaking views to local
residents and tourists alike. It's no surprise that areas such as the southwest
coastal tip are home to cities that show some of the highest home prices in the
country.
City Level
Within each province or state in any country, there are always cities that are
more desirable than others. Vancouver and Toronto are prime examples of cities
that have sustained high population growth rates and real estate prices in
recent years.
Quite often, cities nearby to these popular urban hubs will have their
population and property values undergo a ripple effect -- they will grow because
living costs in the big cities may be too high, so people move to nearby smaller
cities that are within commuting distance. Some examples include: Hamilton,
Kitchener, and Barrie.
Region Level
Within each city, there are always regions that are more desirable than other
due to their proximity to essential services, waterfront, natural views, etc.
Some examples in Ottawa include: Westboro (near water) and the Byward Market
(right in downtown core, near water, near Gatineau Hills)
Obviously, a warm climate or beautiful view does not guarantee great real
estate returns. However, if you are trying to select a region, city, province or
even a country to invest in, these geographical elements can help narrow down
the available choices and give you the best chance at producing high returns on
your investment money.
This article is copyright © 2004-2010 Spirepoint Properties. All rights reserved.
Paul Blacquiere and Joanne Beehler are full time real estate investors and have been investing in Ottawa, Ontario, Canada since 2002. They are owners of Spirepoint Properties, a Canadian real estate investing company dedicated to making real estate investing easy.
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