If you’re planning to put your property on the market, chances are you’re hoping it’ll fetch top dollar. At the very least, you’ll want to recoup what you paid for it plus the cost of any upgrades. And, ideally, you’ll also want to make as much profit as possible on top of that.
Unfortunately, establishing your home’s worth isn’t always a straightforward process. There are various factors you’ll need to consider. And, while some may increase your home’s resale value considerably, others may have the completely opposite effect.
Here are five factors you need to take into account when establishing your home’s resale value.
As a rule of thumb, the older your home is, the lower its resale value.
A more modern home requires less maintenance and repairs before it’s ready to move into, which makes it more desirable in buyers’ eyes. An older home, on the other hand, may require significant upgrades, such as a new HVAC system or expensive electrical or plumbing work. Prospective buyers will usually bid lower in order to offset such costs.
With that being said, there comes a point where an older home will become more valuable. Period homes and properties with historical significance will usually fetch higher prices, because of their charm and character.
But that’s not all.
The condition of your home is just as important as its age. A modern home, poorly maintained, will usually fetch less than an older home in tip-top condition.
2. Location, Location, Location
The phrase “location, location, location” is repeated so often that it has become a cliche. But, while you might have heard it so much your mind has started to filter it out, this doesn’t make it any less true.
There are various factors that make a location more desirable, including a strong sense of community, safety, open spaces and the quality of the school district. This has a corresponding effect on the resale value of your home. The more desirable your area, the more you can expect your home to fetch on the market.
In recent years, walkability has also become an important consideration when establishing the desirability of your home’s location. Good public transportation links and proximity to amenities such as grocery stores and markets have started having a bigger influence on property values.
You can check how well your home does on walkability by using this resource.
Does your home have a history of negative events?
If so, this may lower your home’s resale value.
North Carolina law does not require you disclose whether your home was the scene of a violent crime. However, you’re required to make other disclosures, including past infestations (such as mold), health hazards (lead-based paint, for instance) and known defects, even if they’re invisible to the naked eye.
Fail to make these disclosures, and you’ll expose yourself to the possibility of getting sued for damages.
4. Size and Layout
While size does matter when determining the value of your home, it only does so up to a point.
Most prospective buyers want their homes to be open and spacious, which means properties that are too small will attract a lower price. On the other hand, there comes a point where the amount of square footage simply involves too much upkeep, which can put some buyers off.
But that’s only one part of the puzzle.
Layout is just as important as size. An open layout makes the space feel larger and more airy, which may make your home appear more desirable. This in turn will have a positive effect on its resale value.
Making certain upgrades to your home can increase its resale value considerably. The kitchen and the master bathroom are often regarded as the two most important rooms in the house. Focusing your efforts here can really set your home apart and make it that much more appealing to prospective buyers.
With that being said, you should approach renovations with caution. While some upgrades can make your home more valuable, others are expensive to do and may not add much to your bottom line.
You should be particularly wary of making upgrades that will make your home seem more high-end than other properties in the neighborhood, as prospective buyers may not appreciate their value. It’s a good idea to view other properties in the neighborhood before you spend money on expensive upgrades. Alternatively, you can ask your real estate agent for advice.
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