Having a background in real estate is handy for many reasons. While I’m not actively involved in basic buying and selling these days—I still keep my hand on the pulse of what’s happening by writing about it. And one thing I’ve learned in the process is that location is more critical than is usually considered. Not only should it be near the top when evaluating any move—from a minimalist or simple living perspective I think it deserves closer consideration. That’s why I thought it might be SMART to make a list of the advantages that come from living in the right location—no matter where on earth it is.
Overall, Thom and I have lived in a total of 19 different homes since we met. We owned all but seven of them–everything from our tiny starter home to the ultimate “American Dream” with pool, spa and 3-car-garage. On top of that we invested in a number of properties to “flip” in the early days of our real estate careers and since have gone on to buy a number of long-term investments. Luckily, we’ve learned a lot along the way.
In the beginning we bought properties solely on the “deal.” Either the pricing or the financing worked, and we ended up buying a property just about any time we could swing it. But eventually it became fairly obvious that some properties were better, more valuable, and offered more potential. And one of the deciding factors was always the location. Every real estate broker learns that people might be willing when they first start out buying to overlook a less than desirable location, but once they’ve lived in a property like that, chances are they won’t do it again. People will pay extra, and when given a preference, will always choose a better location over one less attractive. That’s where the saying, “location, location, location” comes from.
Then several years ago when we made the decision to right-size our lives and live more simply, location shot to the top of our list. Instead of looking for a home with a bunch of amenities within it, we started looking for a home with amenities that came with the location. We started out by analyzing our local community for good walkability locations. That’s when we realized that only three areas fit that requirement.
Once we focused on the three locations that seemed like a good match, we then began looking only at homes within a 5-minute bike ride to those areas. One proved far too expensive for our “right-sized” budget, so we focused on the remaining two. Eventually, one area stood out for offering the most value for our requirements. That’s when we bought our current home in the city of La Quinta, California. While La Quinta is a small city of approximately 40,000+, the home we have is less than ½ mile from the old town area making our community feel much more compact. And although our home may be on the modest side compared to a number of La Quinta neighborhoods, as far as we are concerned our location is “priceless.”
So overall, what are the biggest benefits for anyone looking to simplify their life when focusing on location?
1) A good location can save you money. Costs saved can include the need for a car (or cars!) and all the costs associated with owning one. Estimates say that the average cost per year to own and operate a vehicle in the U.S. is around $8,000 each. When you live close to where you work (or work in your home) you save money. Plus, the smaller the home and the lot, the less you will pay to purchase it, maintain it, repair it, furnish it, cool/heat it, and insure it. And don’t forget that a home in a great location can also save you money by providing you with entertainment and amenities that you’d have to pay for otherwise. Things like hiking and biking trails, parks and other recreational services can eliminate the need for expensive gym fees. Check out my previous post on walkability to see more advantages that can save you money.
2) Your location can bring you closer to people you want to be around. This is a fairly common amenity provided by a good location. Lots of people realize that they want to be closer to loved ones, or things like a good school or educational area. But I think it is SMART to remember that our neighbors and our neighborhood will influence our outlook on life. If you are happy hanging out with people who look and sound just like you—no problem. But, if you long to associate with a wide variety of diverse people—different ages, ethnicity, different socio-economics, etc., then consider that when choosing your neighborhood. Your environment will affect you so it’s wise to choose carefully.
3) Your location can give you more freedom to pursue your passions. Face it, our homes represent the values in life that we claim to be most important and the location we choose represents it as well. With our current home Thom and I made a huge effort to rightsize and make it as energy efficient and affordable as possible. Fortunately we were in the position to buy it without a mortgage. So with extremely low utility costs, low taxes, low insurance, no HOA—just about all the stress and headaches that normally come with home-ownership have been dramatically reduced. No one gave us the money to do this—it took work and effort but it was important to us. Obviously our goal surpassed the need to impress others or listen to the push in our culture that says we needed something bigger and more impressive merely because others do it or because we could. We instead realized that the ongoing costs associated with a more extravagant lifestyle meant much less to us than the freedom and peace of mind that we find living our rightsized life. Ultimately the trade-offs we make to live in the location we do, is a direct reflection of our values.
4) Your location can give you more time to enjoy and experience life. We live in an era of time-ruptcy. Just about everyone I know runs around saying there isn’t enough time to do this or that—and yet so many of us go to work and spend hours every day doing things they dislike just so they can run around like madmen during the rest of the day trying to squeeze in a little joy and contentment. What if we just stopped? What if we quit the job and instead rightsized our lives to live more simply and carefully each and every day? What if we spent our time focused on our passions and relationships? Why not? The choice really is ours to make.
5) Your location can reduce your need to commute. Happiness research is very clear that if you select a home a distance from your work you will end up commuting—and that will cost you in terms of money, time, stress and wellbeing. In fact, a Swedish study in 2011 determined that a couple was 40% more likely to divorce if only one partner commuted 45 minutes or more each way. Other research shows that people who commute worry more, are lonely, are less healthy (with recurrent neck or back problems), weigh more, and are much less fit. Real estate agents are often blamed for pushing people far out into the suburbs into the biggest house they can buy. But we’ve all known people who buy big expensive homes in the suburbs without a thought about how far they have to drive. Anyone who ignores the high cost of commuting isn’t paying attention. Economists have now determined that an extra hour of commuting time can only be offset with a 40% increase in salary to balance the cost, time and money associated. Buying an expensive house far away from your work might seem like an advantage, but that commuting time is a constant, persistent daily burden that can make a person miserable.
Location, location, location can and should mean a lot more than just buying an expensive and impressive house in a “good” location to dazzle others. It should also remind us to avoid buying the most expensive home we can find no matter where it is located—just because we can qualify for the loan. Instead our home can be a simple apartment right next to a college where you take classes or a loft next to an art studio where you pursue your dreams. It can be right next door to the school where your kids attend, or it can offer space for your own home garden. Thinking of the location of where you live as a critical element puts the focus on the feelings and benefits that come from where you dwell—rather than what it looks like to others or how big it is to fill up with stuff. Perhaps the SMART approach is to consider the location from the perspective of all the above benefits before you start packing. The true value of “location, location, location” will likely occur once any of us lives in a place where we feel both happy and at peacefully home.