Last Updated on July 13, 2023
5 Factors That Determines Home Value
Post by RyanSellers.com Real Estate Group
Regardless of someone looking to buy or sell a house, one common (yet convoluted) question is always imminent: what is my house worth? Unfortunately, there is no one size fits all answer to the question. The value of a home is determined by several key factors that we will discuss in this blog. After reading this blog, we hope you will be confident to decide on a reasonable price point to list your house or how much you should offer for a home.
One of the most significant factors in determining the value of a house is the location. Of course, desirable locations warrant a higher price tag, but what makes an area desirable? The quantity and quality of nearby schools and parks, ease of transportation, view, the volume of crime and shopping conveniences play a significant role in how desirable a location is.
2. Size and Layout
The square footage, floor plan, and number of bedrooms and bathrooms indicate a home’s value. Other features that can also play a role in a home’s value are the size of the backyard, garage and storage space.
The age of a home is a strong indicator of potential liabilities of ownership, therefore playing a significant role in determining its value. Although older homes can attract buyers looking for a house with more character, cost-conscious buyers should be weary. Older homes that are poorly maintained may come with a slew of foundational and structural issues. Banned building materials that are hazardous to your health may have been legally used during the house’s construction era. Old homes with outdated appliances like boilers, a/c, and water tanks are not energy efficient and will require replacements in the short-term and higher utility bills in the long term.
A house may be located in a desirable location, has the perfect size and layout, and is relatively new with modern features and appliances. Still, if the condition of the house is poor, it will drive down the house’s value. When looking at homes, it is critical to consider a property’s interior and exterior condition and the potential repair costs.
5. Market Trends
The real estate market trends are a vital indicator of a house’s value. The economic factors, supply and demand, interest rates, shifts in market trends and societal changes can increase and reduce the value of a home.