Whether you are thinking about putting your home on the market or simply want to keep up with the market value of your largest investment, it’s helpful to understand the primary factors that can impact your home’s value.
While homes in the same neighborhood may have comparable values, a number of things go into determining a home’s value that can differ from home to home. Here is a look at some of the most critical attributes when it comes to determining the value of your home.
Location, Location, Location
The old adage that real estate is all about location certainly rings true when it comes to determining your home’s value. Location is arguably the most critical factor in determining what a home is worth.
Location can be a frustrating factor to deal with as well because it is out of your control. Your home’s value can be significantly impacted by its surrounding area, but it can also be impacted by such issues as close proximity to a highway or airport. While some potential buyers may find the location convenient for travel, others may not want the noise that comes with it.
If you are in the market for a new home and find multiple properties that check all your boxes, consider basing your decision on property location. You can always update a kitchen or put in new landscaping. You can’t change a home’s location, at least from a practical sense.
It may come as a surprise, but just as with location, the quality of local schools plays a major role in determining a home’s value in most markets. A home may be up to date and have great curb appeal, but if it happens to be in a location with a poor-quality school, the value can be impacted. This is another one of those factors that is both fluid–new schools are built, a school’s performance changes–and beyond your influence as a homeowner, at least for the most part.
You may not want to address your leaky roof, but if you plan to sell your home, the problem will be a concern for buyers, who may not want to pay full price knowing they have a major repair on their hands. If they opt for an inspection, you will likely be asked to make the repair or offer a reduction in price to compensate for the issue.
Other big ticket items that impact your home’s value include the age and condition of windows and the HVAC system. Even small issues can impact your home’s value. If potential buyers see that you have not conducted routine maintenance on your home–as evidenced by things like leaky faucets, neglected caulking, worn woodwork and dirty walls, among other things.
Ultimately, the real estate market will make or break your anticipated asking price for your home. If the real estate market continues strong, you can expect to set your price on the higher end of the scale. While this is also a factor you cannot control, it is also one that can change. It pays to be mindful of shifting real estate market conditions when setting the price of your home.