Location Analysis
Location Analysis is the appraisal of a general geographic area for a particular use.
A Residential Real Estate Market professional (or consumer) rarely deals with a Location Analysis in connection with a sale, as they are usually done in the Commercial Real Estate Market and the Industrial Real Estate Market. But a Real Estate Agent might consider a smaller version of Location Analysis - sometimes done on his own, without the help of an appraiser - for self-improvement purposes, in an effort to generate a better Market Analysis.
Let’s see an example of Location Analysis:
A big industry is interested in opening an office (or a plant, or a huge store…) in a location within a general geographic area (which may be several hundred square miles in size). They like that area, but need to understand if it is the right place for such a large investment on their part. They order a Location Analysis so they can make the final decision with confidence.
A good Location Analysis must consider factors like:
- Business climate. The area of a growing market. What are its outstanding commercial and industrial features?
- Demographic data. Size of the population, its growth rate, composition in terms of age, family size, and educational attainment.
- Geographic features. What topographical features does the location have? What is theclimate like?
- Income. Personal and family income is an important consideration in determining a good fit with other requirements.
- Markets. What commercial markets does the area have? What are their features and size? What are the consumer markets like?
- Infrastructure. How is the transportation system in the area? Does it have easy access to major highways, availability of airports, air services and railways? What about its power grid and internet service? Generally how fast and secure are those services there?
Real Estate Advice:
Check out our Glossary Terms page. We have all the best words in Real Estate: the obscure, the cliche; we have them all.
Have no time (nor space in your head) to learn all of that stuff? No problem. Access The OFFICIAL Real Estate Agent Directory® and let a professional do that for you!
Popular Real Estate Terms
Violating a law, commitment, duty, or obligation through commission or omission. The responsibilities of an agreement or guarantee are not met. ...
Descriptive of the architectural development of property in a certain area. For example, a housing subdivision may use very similar building architecture throughout the development. All the ...
A sash window having two vertically moving sashes respectively offset by sash weights. Each sash closes a different part of the window. ...
Power or strength of economic factors an variables influencing the real estate market. For example, real estate values may decline in times of recession because people cannot afford to buy ...
Arches, either roofed or open, mounted on a series of pillars to form a passageway or walkway. ...
The angle of a roof in relation to its horizontal axis expressed as a ratio of inches (cmm) per foot of horizontal distance. The sloping of ground, such as sloping ground away from the ...
Analysis of a real estate sales data to appraise real estate values. Sources of real estate sales data used in the market data approach include the official records of deeds and leases ...
Same as term closing: legal process of transferring a piece of real estate to a buyer. Typically it occurs in the office of the lender, attorney, or an escrow company. ...
A way to sell and finance property by which the seller keeps title but the buyer takes possession while installment payments are being made. The gain is taxed while the mortgage ...
Have a question or comment?
We're here to help.