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Factors That Influence the Value of a Home

Home builders

The value of the home will be determined by what buyers are willing to pay. There are a couple of factors that could influence the price of your home. It is always going to be a challenge trying to accurately price the house. That is why there is a need for an effective home valuation if the house is to sell in the shortest time possible. That is why you need to seek the services of a trusted real estate agent who will come up with the right valuation for your home. Alternatively, you can reach out to Houston RE House Buyers if you’re looking for home buyers that will not ask a lot of questions. Here are some of the factors that could influence the value of your home.


Historical Sale Prices

The first thing that real estate agents will look at is the historical sales price of the property. The price that is likely to be quoted will be close to the one that it was recently sold at. There are a couple of factors that could also determine the historical sales price like the general state of the industry.


Neighborhood

Another factor that could determine the value of the home is by looking at the sale of similar houses in the neighborhood. Similar houses are usually referred to as “comps” It could be a comparative market analysis or home appraisal of the other homes which can be used to come up with an estimate.

The challenge is you can’t get the same value for any two comps so there will be a need to make an adjustment in order to factor in the key differences. It may not be possible to do the whole process manually as there are individual details that will need to be compared. There are home value tools that you can use to get an estimate based on the variables that are included.



Location

The location is a key consideration that potential buyers have in mind when searching for a new house. The buyer wants a house that is close to the social amenities. They don’t want to drive for long distances to get to work or drop their kids to school. The three main things that a potential home buyer will look at in terms of location includes:
  • Employment opportunities
  • The quality of schools in the area
  • Proximity to entertainment, shopping, and recreational facilities
Such factors could determine the price of a home in a particular neighbourhood. The closeness to transportation facilities is also another location consideration that most people will look at when shopping for a new home.

Usable Space And Size

Size is going to be an important consideration when estimating the market value for your home. A big home with usable space is likely to fetch more. The value is calculated per square footage. The price per square foot is usually set at $100 in most states. That means a 2000 square foot house can fetch up to $200,000 if all factors are held constant.

The usable space is also an important variable when determining the value of the home. Attics, garages, and basements are usually considered as usable space in a home. The most important part is the livable space in the home. The bathrooms and the bedrooms are highly valued and could significantly impact the final value of the home. According to the National Association of Home Builders, adding the bathrooms and the bedroom could increase the home value by up to 20%.



Age And Condition

A home that is newer is likely to be appraised at a higher value compared with one that was built more than 50 years ago. The critical components like the HVAC system, plumbing, and appliances are likely to be newer which will have a bearing on the selling price of the house.

Home buyers are willing to pay top dollar for houses that are move-in ready. This is the reason why most buyers will demand an inspection contingency clause in the contract especially if they are buying the house through a lender. You can still be able to sell your home without doing the repairs but it might not fetch as much.


Upgrades

Doing some upgrades however minor could add value to your home. It should be noted that not all renovations can be recuperated and that is why you should only spend on upgrades and updates that add value to the home. A fresh coat of paint always does the trick.

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