Bite-Sized Basics: How Location Impacts Property Prices

Posted by Owun Taylor

Why is location so important in real estate?

One key characteristic that sets real estate apart from all other assets is its immobility. Property is stuck in one spot, unlike shares, bonds or physical assets like gold or art. And the location is what largely determines its scarcity and ultimately its value.

In nature animals also tend to gravitate toward certain geographical features. Open water fish will often aggregate towards any sort of structure in the open ocean, this might be as simple as a floating tree or as significant as a seamount (an underwater hill) that disrupts the prevailing current and causes an upwelling that brings nutrients up from the ocean depths.

On farms, you will often see sheep gathering around a lone tree for no other reason than it is the only piece of structure on the paddock.

Similarly, humans have an equally broad range of determinants when it comes to selecting an ideal property for themselves. Typically, the most highly demanded locations are scarce and people are willing to pay a premium to own them.

Let’s have a look at some of the key location features that can have an impact on property prices.

Amenities:

What constitutes an ‘amenity’ can cover a huge range of things. But put simply, we’re talking about things like cinemas, parks, gyms, sporting parks and other types of recreational facilities. These can appeal to a variety of demographic groups. Young families will often gravitate to places with more open spaces, parks and playgrounds. The senior citizens often prefer to live close to medical facilities, shops and restaurants. Single professionals may prefer to live close to the office, entertainment and the buzz of nightlife.

Schools:

One of the more interesting phenomena that we have observed in the last 10 to 15 years is increased property demand in school catchment areas where the academic performance of state schools is better than average. A school catchment area is a defined geographic area, typically around a state school where you must live to have your children automatically enrolled. This is not too surprising given that parents want the best for their children and for many a good education is a top priority.

Transportation:

This one is a bit of a double-edged sword. In some locations, access to good public transportation is sought after to reduce the pain of the daily commute to work. But on the northern beaches in Sydney, many residents seem to prefer the fact that there is no rail line spoiling the land and potentially bringing bigger crowds on mass to the beaches. A rail or bus node to an employment hub is seen as a net positive for most people.

Natural features:

This one is obvious for most Australians. Property near water or with a water view tends to be scarcer and commands a price premium. But other natural features can also increase the relative attractiveness of one property over another. These could be things like having escarpment views, in an elevated position, close to parks and forests and even the simpler things like having access to natural light.

Crime rates:

Property location affects crime rates due to factors like population density, accessibility and economic conditions. Areas with high population density or extreme isolation can potentially have higher crime rates, as can locations that attract economic activity.

A region’s ability to attract new economic activities, adapt to economic changes and generate local development influences its crime levels to potentially decrease.

Economic factors:

While I don’t think that owner occupiers specifically look for economic factors in a location to buy a property, being close to an employment hub tends to be a net positive. This is clear when you track the median prices of suburbs and compare them to the distance to a Central Business District (CBD).

In the most part the closer you are to a CBD the higher the median property price.

Competition:

The most desirable property locations tend to face the most competition from prospective purchasers, increasing prices. Most owner occupier or blue-chip locations tend to weather downturns far better than other small country towns further out.

How to choose a property location:

Whether you’re a first-time property investor or experienced investor, investing in real estate can be a lucrative venture, but it requires careful consideration and research. Property research is essential for investors who want to make informed decisions, mitigate risk and gain a competitive advantage in the market. Blue Wealth Property is a leading provider of property research services, with the only independently-audited research model in Australia, allowing us to offer investors much more comprehensive insights and analysis to help them achieve their investment goals.

Research is critical for investors who want to make informed decisions based on market trends, forecasts and expertise and choose the right property for them. Without research, investors may be susceptible to poor investment decisions, which can lead to significant financial losses. Real estate research provides investors with insights they need to identify emerging trends, understand the market conditions, and make informed investment decisions.

Thinking about your next property investment? Book a free Discovery Call with our team. We’ll help you find the right location and the right opportunity.

Owun

Knowledge is Power

Owun is the Senior Education Specialist at Blue Wealth Property and hosts The Clever Investor Property podcast. He has worked in finance and property for well over 25 years and is known for being able to easily explain the complex world of wealth creation.

Posted by Owun Taylor, on 2nd Jun 2026