There are many factors affecting the value of a certain property. These factors can attribute to the depreciation or appreciation value of real estate property. The actual value of the property is dramatically affected by a combination of local factors that can cause its value to either increase of depreciate.
Whether you are buying or selling a home or investment property, you need to determine the actual value using these factors:
Convenient and accessible location
Location will always be the top factor when computing the value of a property – whether under depreciation or not. A house located closer to schools, grocery stores, public transportation and business or shopping districts will tend to be in greater demand than houses located too far out of the way. It directly relates to accessibility and convenience.
An area that is likely to be affected by natural disasters like tornadoes, floods, or hurricanes is a poor choice when buying an income property and so the property may not reach its highest possible value. Anyone searching for a home searches for safety as well. So for an area to be geographically stable is a key factor that will help in determining the value of your property.
It helps to increase the home property value by any kinds of upgrades. A new roof may give an 80 percent increase on the value. Other upgrades that will be helpful are renovated kitchen and bathroom, representing a major expense.
Age and condition
The older the property, the less valuable it becomes. New houses are naturally worth more and historical homes can be very valuable if they have historical significance. The condition of your home also plays an important element when it comes to determining its valuation. An old but well-maintained property, can achieve a valuation that is the same as that of a new build of equivalent specifications. Keeping your property well-maintained will keep its value high. So always upgrade and improve your home so as to keep its worth high.
Aside from the accessible location of the property, if it is developed by a reputable real estate developer, the property will certainly increase in value over time provided that the overall economy and supply and demand are steady enough to sustain the investments. Reputable real estate developer provides development quality, which is the quality of the built environment and the processes used in building it.
Crime rate in the neighborhood
Nobody wants to buy or live in a neighborhood that has significant high crime rate. Any sort of reputation of crime in an area can affect the value of your income property. People avoid dangerous neighborhoods. Studies show that the impact of crime can dramatically affect the value of your property.
History of the property
Events in the past such as pest attack, flooding, or any incidents may great affect the property value. Potential buyer may doubt the strength of the foundation. This factor is aligned with the crime rate because buyers may actually look into issues like theft, suicide or any criminal activity. Negative history of the property may add to the difficulty of selling it and depreciate its value over time.