Real Estate

What determines the value of a home?

A homes value is always determined by size, amenities, condition and location.

A lot of people look at the price per square foot of a home in comparison to that of other properties in the area. While this is a good indicator, it should be noted that every neighborhood has a minimum and a maximum sales price. So understand that a small home may sell for a higher price per square foot while a larger home especially one larger than the average build size in the neighborhood will typically sell for less price per square foot. So look to see the average sales price in the neighbor as well as price per square foot.

Does the home have a lot of upgrades? A new furnace, hot water tank, appliances, storm shelter, swimming pool, out building, new carpet, or granite counter tops. And what is standard in the price range you are looking? While replacing these items may not add a lot of value, having a property in need of updates can make the property harder to sell and can depreciate the value of the home in the eyes of the consumer.

If a home needs repairs cosmetic or otherwise it is going to affect the value. A buyer may not want or have the means to purchase a home that requires repairs. In addition, the buyer may be obtaining a loan that requires the home to be safe, sound and secure. If the house is in substandard condition, the price will need to be adjusted to allow a new owner to make the repairs. A buyer looking at a home in need of repairs will often discount the property far more than the actual cost of the repairs for their time and trouble.

In Real Estate location is the name of the game. A buyer will often pay more for an identical home in a certain area of town or a certain school district. A home close to a park in the back of the addition is generally more valuable than one on the main street at the front of the addition. If the other homes on the street appear to be dilapidated or the area is unsafe to the buyer, the home will sell for less than if the neighbors maintain their properties and the area appears safe.
I often tell prospective buyers when looking at homes to stand on the front porch and look out as well as looking in a house. You can always paint and carpet but you can’t change the neighbors. Do you see boarded up homes, or homes in need of improvement? Have you checked the crime statistics for the area? Is there a Home Owners Association and have you reviewed the covenant and restrictions, as well as any fees?
There are lots of factors that figure into the value of a home. Working with a full time Realtor can help you determine the value of a property and the price you are willing to pay. If you are looking to buy or sell, please feel free to call me at-405-213-2992 or visit my website at http://www.sandiwalker.com

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