Understanding What Affects House Prices and Value

Selling your home is likely to be the largest earning event of your life, and if you’re buying, it’s likely to be your biggest investment.

As such, what goes into its price and value is a much bigger deal than some other random purchase that’s not going to have as much of an impact on your life.

So, what affects house prices, and how do buyers decide what a home is worth? Let’s dive in and break it down.

1: Surrounding Area and Home Values

One of the major factors that will impact a home’s value the most has nothing to do with the home itself.

The location and the value of the surrounding homes both play a massive part in a home’s value.

The home can be rather extravagant, but if it’s in a lower-income area with smaller and older homes, it won’t fetch as much as if it were surrounded by an upscale area.

The same goes for the opposite conditions. Even a home that’s not all that impressive compared to the neighbors will fetch a bit more if the surroundings are in high demand.

In fact, this is one of the key elements appraisers look at when valuing a home, and if you want to sell your home fast, choosing the right price based on location and nearby comps is absolutely essential.

2: Condition

The condition of the property is always going to be a huge factor. If the home is great in regard to all the other factors, each problem is going to have an impact on the price.

Something such as a very old roof, cracked foundation, or other high-cost repair will dramatically impact home value, but even smaller issues, such as minor mold infestations or smaller plumbing issues, can reduce value by a fair amount.

It’s often best to make sure these issues are fixed before selling to maximize value. You might even want to fix the issues and then wait for the value to increase again before selling if the cost of repairs is too high.

3: Size of the Property and Home

The size of the property and the home itself both impact the price dramatically. Large, spacious land with plenty of opportunities for development or other uses is desirable, and a larger home is going to cost more than a smaller one for obvious reasons.

4: Modernization

While some old-fashioned features, especially aesthetic ones and core structural building materials like brick, are desirable, no one wants to purchase a home with a 70-year-old HVAC system or plumbing unless they have to.

Modernization, such as plumbing, appliances, and other things that will need to be updated periodically, will help increase the value of the home because it gives buyers a better living experience, and it ensures minimal repairs and upgrades in the short term.

5: Presence of Unique and Useful Features

The presence of in-demand features will also positively impact home value.

If the home has an amazing view of a nearby attraction or landscape, that often helps boost the value.

Lakeside positioning, a properly maintained well, and other useful features that aren’t too common can increase value.

Understand Your Home Value with Sunny Gawri Real Estate

Understanding what affects house prices makes the entire selling process a lot clearer. From location and nearby comps to condition, size, and unique features, each detail plays a role in how buyers see your home’s value.

At Sunny Gawri Real Estate, we’ll guide you through it all and give you access to a free home evaluation tool so you know exactly where you stand.