Australian Property News
Some fundamentals of property
Posted on Monday, March 08 2010 at 3:59 PM
Land, building or capital improvements and market conditions are some of the fundamentals of property, according to Direct Negotiations buyers advocate Chris Nicolas.
He says land is the most important feature of property because it's the core element that holds the value and is the hardest to value with its limited and mixed qualities.
"To emphasise, no piece of land will ever be the same as another, yet you can duplicate building designs and materials quite easily," he says.
When it comes to the capital improvements on the land, Nicolas says they should be of the 'highest and best use' providing for the needs of its users – being the target market – and in alignment with the intended use set out by the local development plan.
Market conditions are extremely critical in any investment, according to Nicolas.
He says they have the greatest implications on timing the entry and exit of a property investment.
"Understanding the current market conditions and gathering an opinion – based on facts – of where the market is heading should influence an investor's decision to buy, hold or sell," he says.
"A good market analysis should also reveal the highest and best use for the land based on market demand and supply shortfalls, becoming an important tool for developers and renovators."
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