When you’re buying or selling property, the value of the property is a very, if not the most, important factor in the decision-making process. We’ve compiled a list of 6 main factors that will affect the value of a property, so grab your checklist and see how many of these tick the right boxes!
Location is a no-brainer factor when choosing property, and is usually the main factor affecting a property’s value. It takes into consideration the price of (current and future) properties in the surrounding area, ease of access, quality of local schools, the local community, etc.
The health of the economy is also a key factor in determining the property value, and is measured by the country’s GDP, employment rate, cost of living, etc. When times are bad, demand for real estate will be low, which will bring down market prices and reduce market value of properties. Generally speaking, when the economy is slow, real estate value is low.
#3 Amenities & Accessibility
Availability of amenities such as grocery stores, restaurants, malls, post office, schools, and recreational parks nearby contribute greatly to the market value of property. Accessibility via public transport and main roads is also a vital factor, as buyers will pay premium prices for the convenience of having these within walking distance.
The statistics of an area’s population, such as age, race, gender, income, growth and even crime rate. This factor is often overlooked by people when considering property., but it is particularly significant when the buyer is planning to stay in that area. For example, a family with young children might prefer to stay within a relatively young community, so that it will suit their household and lifestyle needs.
#5 Condition & Upgrades
Buildings and fixtures generally decay over time, succumbing to issues like mold, leaks, cracks, plumbing problems, and aged fittings. A well-maintained house or property will yield better market value. Similarly, older properties that have been upgraded to suit current needs can demand better value compared to those in the same bracket that have never been renovated. A word to the wise, though: overly ‘fancy’ furnishings or fixtures might put off some buyers, as design preference is a highly personal thing.
#6 Negative Events
It is important to know the history of the property before deciding to purchase it. If a property has been through fire or flood, or was the site of a violent crime, it will be much more difficult to sell and more likely command a lower price compared to other properties in the immediate vicinity. Some buyers might have concerns about the property’s structural stability, while others may not be comfortable with its negative history.