The location red flags you can't ignore – and those you can probably live with

Imagine you’ve just found a property that ticks every single box – natural light, spacious living, loads of storage and a straight-out-of-a-fairy-tale backyard.

Except there’s one catch: it’s on a main road.

At first, you might think the location is a major red flag, but that may not be entirely the case.

Depending on how much it bothers you, whether it’s factored into the pricing, and how much you’re thinking about resale, it could be either a reason to walk away or a compromise worth making.

Here are some common location trade-offs and how to assess them.

Main roads and busy streets

Busy roads come with some fairly obvious drawbacks: noise, congestion, a less appealing streetscape and potential pollution.

For some buyers, this can be a massive turn-off, but for others, it could be a positive if they’re willing to tolerate it.

“Buying on a main road could get you into a suburb that you couldn’t previously afford, rather than having to buy on a quiet street but be three suburbs further out,” says buyer’s agent Amy Lunardi.

The drawback is that main roads can impact resale, according to InvestorKit chief executive Arjun Paliwal.

“Main road properties take longer on average to sell and can often have larger discounting,” he says.

Train lines

Noise from train lines varies significantly according to proximity to the railway, the frequency and type of services, and whether there’s a level crossing nearby.

“You could be near a train line … [and] if you’re not near a crossing, it could be okay. But if you’re right near the dinging of a crossing, that could be much more impactful,” says Lunardi, adding that the impact can be highly subjective.

“There’s main road noise, which some people can get used to. And then there’s stuff like … trains and trams, which are a bit more abrupt,” she says.

Paliwal adds that proximity to active, high-use train tracks can affect future value, too.

“When you are right next to or in very close proximity to active, high-usage train tracks, these are the kinds of due diligence factors that can impact a property’s resale,” he says.

Industrial areas and powerlines

Industrial areas can bring noise, regular truck activity and even unpleasant smells – issues that aren’t always immediately obvious during a 30-minute open home.

“I’ve had a few situations in the past where I was looking at properties that were kind of close to an industrial area, and there were a lot of people who were talking about … a smell that was coming from some of the factories,” says Lunardi. “That kind of local intel can be really helpful.”

You might be able to tolerate sounds and smells, but one issue can be harder to overlook: high-voltage power lines. These can be eyesores if they’re visible from the property, and they can also raise lending concerns.

“Being within 50 metres of those high voltage transmission power lines … [is] a higher risk rating,” says Lunardi. “They [lenders] might either say no to that property completely [or] require a higher deposit from you.”

Overlays

The due diligence phase might reveal the property has a particular overlay, but not all overlays are equal.

“You could be in an overlay that is a flood risk based on a river flooding, which is more severe than an area that has flood risk due to something like stormwater flooding,” says Lunardi.

“If it was in a high-risk flood zone, that’s a dealbreaker … but if it’s in a low-risk area, that’s very much personal preference.”

Overlays can affect everything from lending to your insurance. Lunardi recommends speaking to multiple insurers to confirm you can insure the property.

“Every insurer is different in the way that they assess things,” she says.

Zoning and future development

Zoning is another factor to think about. A property might seem unaffected now, but it can easily change if the area is flagged for higher-density development or future infrastructure.

“Especially if you’re next to larger sites … there could be a higher risk of more apartments going up nearby, which could impact things like your privacy or your natural light … [and] increased parking challenges in the area, and the noise,” says Lunardi.

However, Paliwal points out that a zoning change may actually prove beneficial if it materially improves the value of the land.

Flight paths

Flight paths are a grey area, and the difference often comes down to whether the property is under an established one.

“They’ve been around for decades … [and] as a result… it’s kind of been priced into the last five or six years of sales for that suburb … you typically have enough sales to make a decision that’s factoring that,” says Paliwal.

“Where flight paths become an issue is the change of flight paths.”

If you do think the noise could bother you, it’s essential to perform thorough due diligence. Even if the property is kilometres away from the airport, planes can still be considerably disruptive.

“If you are buying in a flight path, you need to get a sense of the airport hours and hang out in that area for a full day or two if you are worried about that,” says Lunardi.

Schools

If you’ve got kids, being near the local school could be a huge plus.

“For me, for example, I wouldn’t mind backing onto a school,” says Lunardi. “I work full time, and if the school allowed me to, I’d use that space for my own kids to hang out on a weekend.”

If you are concerned about the noise, remember that school activity is largely contained to working hours.

“Something like a school is always going to be more manageable if someone’s not working from home. If someone’s working full time, school hours aren’t really going to impact them at all,” says Lunardi.

That said, being right beside the drop-off zone or car park can be a different proposition.

“Properties right next to the car park of major schools for drop-off and pick-up don’t end up performing as well in terms of sale value,” says Paliwal.

When is a compromise worth making?

So, how do you know whether to proceed or walk away?

Lunardi recommends experiencing the location not just during a Saturday inspection but at key times throughout the week: during peak hour or school pick-up, when nearby businesses are open, when flights or trains are operating and even late at night.

A private inspection is particularly useful because you can spend time inside and outside with doors and windows open and closed, giving you a more realistic sense of the potential issue.

Paliwal recommends looking at what the market is telling you. Are similar homes taking longer to sell, or selling for less? That gives you a strong indication of whether you’re accepting a personal compromise or a market disadvantage.

He also says the pricing should reflect the trade-off.

“Anything that is going to reduce the amount of buyers interested in that property is going to mean that property will be discounted now and later,” he says. “You buy at a discount, you sell at a discount.”

Lunardi suggests asking yourself the simple question: “Can money fix it?”

Double glazing or acoustic insulation could improve noise, fencing can improve privacy, and landscaping can help improve your outlook.

But a train route or high-voltage power line can’t be fixed with money alone – and that’s when you might be better off letting a property go.