If you are planning on selling your home in the near future, you may already have spoken to real estate agents about how much they believe the property is worth. However, it is important to remember our home valuations
are not guesses or hunches. Instead, these estimates are calculated
by looking at major factors that impact the value of a property, such as:
1. The Neighborhood
When determining the value of a home, the neighborhood it is situated in plays a large role. However, this doesn't mean the area has to be perfectly manicured in order to add value to your home. Instead, home buyers are more interested in neighborhoods
that offer easy access to schools, restaurants, stores, and job opportunities. If your neighborhood offers these amenities, it will be positively reflected in the value of your home.
The next big factor in determining the sale price is the size of the house. Common logic dictates: The bigger your house, the more it will be worth. However, square footage isn't the be-all-end-all when it comes to home valuation. Buyers are also concerned
with the number of bedrooms, the number of bathrooms, and whether the house has any other usable space such as a garage or a basement.
Put simply, the better the condition of your house, the more it will fetch on the market. You could have a new, but poorly maintained house that will be worth less than a slightly older, but better maintained, living space. As such, if you are planning
to sell your house soon, it would be wise to carry out some minor renovation work ahead of time.
4. The Economy
Quite often, the value of property closely follows the state of the current economy. When jobs and salaries are booming, buyers have more money to purchase homes with, so property values will rise. When the economy takes a turn for the worse, buyers have
less money to spend and values will begin to decrease.
The Bottom Line
Though it can sometimes seem like property valuations are made up or simply pulled out of thin air, this is not the case. Home valuations are arrived at through complex calculations that include factors such as the four mentioned in this article.