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The top 3 factors that determine the value of your home

Posted by Betsy Repaske on May 15, 2015
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“My neighbor’s house sold for $10,000 more than that,” or “But my Zestiment is $30,000 more than what you’re suggesting,”  home pricetag

These are sentences most Realtors had heard many times during their career.

There are many factors that go into determining the value of your home and many of these factors can vary year to year. Home value calculators and estimations online never have all of the facts. While there isn’t an equation that can accurately predict the value of your home considering these three key facts can help you decide if you are listing it for a fair and reasonable price.

 

1) The location and condition of your home

The location of your home is more than what area of town you live in and what school district your kids go to. Those neighborhood and school district are two big factors. Location can be even more zoomed in than that. If your property backs up to a lake it could be worth more than your neighbor’s house across the street. Conversely the house down the street from you could sell for a higher price because it is in the quiet neighborhood while you can hear the traffic from the busy intersection. It can even get down to the condition of your neighbors house. That bright pink color they painted the house or that beat up car in their front yard, those can hurt your home value.

That said the condition of your house can be equally important to your location. You don’t want to be the one with the overgrown yard, the outdated kitchen or the roof that needs replacing. The good news is that you have control over the condition of your house. You can’t move your house into a nicer neighborhood but you can paint, landscape and make sure you stay on top of maintenance issues.

 2) Similar homes that have sold in the last year to 6 months in your neighborhood

If your neighbor sells their home for a really great price, that is good news for you. The price of your home is based on comparable sales and how your home’s features compares to the features in those sold properties. If you have a three bedroom, 2 ½ bath with a two car garage, your Realtor and home value estimation software looks at how much the other 3 bedroom 2 ½ bathroom homes in your area sold for recently.. This is where we have to refer back to point number one though and why a lot of home valuation software gets prices wrong. If you remodeled your kitchen since you bought it your home will be worth more than the comparable homes that have their original kitchens. A Realtor who has seen your home can better judge comparable homes against the condition and location of yours and adjust your asking price accordingly.

3) The Market at the time you plan to sell your home

The last big factor that affects the value of your home is the current market. Your home might be worth more this year than three years ago because there are more interested buyers this year and fewer homes for sale. Remember the law of supply and demand from your economics class? Real Estate lives by that law in most markets. If there are a lot of homes for sale in your area and not many interested buyers the price of homes will go down. As a seller you’re hoping that everyone and their brother is house shopping and your home is one of the few houses available in your area. Your Realtor has a good idea of how the market is behaving this year in your area and in your price range. A Realtor can recommend a listing price that balances the value of your home and what it will sell for in the current market.

No two home sales are exactly the same but it is possible to carefully look at all factors that affect the value of your home and price your home right for the market at the time, to get maximum return on your investment and sell in the shortest time possible. Evaluating the value of a home accurately demands having a strong understanding of the area, comparable homes and the current market. Contact us at DwellHop or your local real estate agent if you want help determining the price for which you should list your home.