9 Influences on Your Home’s Worth
We’ve all heard of buyer’s and seller’s markets. During a seller’s market, you can expect to rake in top-dollar for your home, but during a buyer’s market, you are more likely to go out with a whimper. Right? Actually, your home’s worth is much more nuanced than the status of the real estate market.
Here are nice factors that may affect your home’s worth:
Location
We all understand why a penthouse on Times Square costs more than an apartment in the Bronx. Much more baffling is the drastic variation that can exist in the prices of similar homes in the same neighborhood.
Small aspects of your home’s location can make a big difference. For example, a home on a cul-de-sac is more valuable than a home at a four-way intersection. Or you may be surprised by a seemingly inexplicable jump in your home’s worth, which is, in reality, caused by forecasts for future development in your area.
Age
Historic homes have a timeless charm. They are always in demand. Modern homes also have huge appeal, seducing buyers with up-to-date appliances and trendy finishes. But what about homes that are neither historic nor modern? Unfortunately, if your home is between 40-50 years old, it may be stuck in an awkward age for a while – the real estate equivalent of being a tween. Value is generally less for these homes.
Outdated style
Every decade proffers a new style. The seventies had their shag carpet, the eighties their wallpaper borders, the nineties their sponge paint and the new millennium swamped us in “espresso” wood. When prospective homebuyers finds themselves stepping into a new decade, instead of a new house, they are likely to be turned off. Since a home’s value is ultimately determined by what the buyer is willing to spend, outdated style decreases value.
Extremely personal style
There are those visionaries among us who have a penchant for decor that, well, nobody else likes. If you are one of these rare birds and you have done major renovations to make your nest your own, you might have trouble finding a buyer who will appreciate your masterpiece as it deserves.
Permanent record
Houses, like people, have a public record. If your house has suffered damage from a fire or flood, you might be dismayed to find that its public record has a permanent scar, even if your house has made a full recovery. Similarly, a history of crime in your neighborhood may take a toll on your house’s value, even if crime rate has plummeted in recent years.
Size
When it comes to size, homebuyers can be as picky as Goldilocks. Square footage is often one of the first statistics a homebuyer reads about a house. If your house is abnormally small or abnormally large, it is likely to have less appeal to the masses, who are looking for a home with a size that is “just right.”
Bedroom and bathroom count
Immediately after taking mental note of square footage, homebuyers often zero in on the number of bedrooms and bathrooms a home offers. In fact, most home search websites offer filters for number of bedrooms and bathrooms, so if your home doesn’t offer what a buyer is looking for, they might never even see your listing.
Out of place
Perhaps your home has always been a little different than its neighbors. You might live in a brand new condo in a historic district, or you might have a single-family home in a trailer park. While there may be nothing inherently wrong with your home, a home that is dissimilar to the homes around it can be given a low appraisal by the bank simply because the bank cannot find prices for comparable properties in your area.
No hook
Some homes are distinguished by features that snag buyers; they may be beautifully landscaped, have a neat back story, or be near a famous landmark.
Other homes are not.
Lack of a hook may not be a problem if your house is passable and the market is not inundated with houses, but as competition increases, it’s the houses with hooks that get the most interest from buyers and the highest resale values.
Whether you are passively keeping tab on your home’s worth or gearing up to place your home on the market, knowing these influential factors can help you make sense of your home’s resale value. Remember, it’s not all about the market! You might even be able to make alterations to your house that will increase its value no matter what market conditions are.