What factors influence a home's worth?
Category Housing Market
There are several factors at play that affect a home's resale value. Understanding these factors can help buyers and sellers make informed decisions that can lead to more profitable outcomes.
READ: Ways to ensure your home holds its value over time
Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, explains that while some factors are out of an owner's control - like market conditions and unplanned changes to the immediate surroundings - other factors can be improved upon to help boost or maintain property value. "Things like regular maintenance and repairs and clever home staging can all have an impact on the home's selling price," he notes.
To help buyers and sellers understand what they have control over and what they don't, RE/MAX of Southern Africa explains some of the leading factors that can affect property values...
Market conditions
Currently, South Africa's housing market can largely be described as muted, with annual property inflation sitting at around 2.29% according to Lightstone Property's latest report. Interest rate forecasts do not look promising, which means that buyer activity is likely to remain low. These overarching market factors can play a role in how much a property is worth.
"While there is nothing a buyer or seller can do to change the market conditions, their reaction to the market conditions can impact their bottom line. For example, choosing to overprice a home in a down market will often lead to a lower selling price than if the owner listed the home at a more realistic price at the start," says Goslett.
Location, Location, Location
Where a property is situated has arguably the largest impact on a home's resale value. For example, while the national average for house price inflation is 2.29%, house price inflation in the Western Cape is an outlier at 4.9%. This plays out on a suburb level too.
"There is nothing a seller can do about the location of the home once they own the property. That's why it is important to know the market trends within a specific suburb and to find out if there are any plans to develop or change the area before signing an offer to purchase," Goslett recommends.
Specifics of the home
The size of your home, including the number of bedrooms and bathrooms, as well as its overall layout and floor plan, can affect its value. Larger homes or those with functional layouts often command higher prices. Well-maintained properties with modern amenities will also typically be higher in worth.
"The prices of similar homes in your area can provide insight into your home's value. The market value of your property will then vary depending on how similar or unique your property is in relation to other homes. The more uniquely desirable your home is, the better your chances are to sell for a higher price," says Goslett.
Of course, the best way to find out more about the factors that are affecting your home, is to speak to a local RE/MAX agent for some free insights and guidance. "If you are a buyer, chatting to a real estate agent can help you make more informed decisions regarding your purchase. If you are a seller, working with a real estate agent from a reputable brand can help you see your home reach its full potential and sell for its full market value," he says.
READ: Tips: 3 ways to stay on budget when renovating your home
Seeff's agents highlighted some cost-effective improvements which can increase the value and make the property more attractive to buyers. (click here to read the full article)
Repainting. New modern colours such as grey, green and even black are all the rage right now, but it does not have to be as dramatic as that. Even just upgrading the exterior and interior in new paint tones, albeit fairly neutral, can add value and could spark buyer interest.
Floors and tiled areas. Floors can be modernised with wooden or laminate flooring, or feature tiles in the latest trends, or new carpets. Wall tiles can also be replaced to give an instant update to the appearance of the kitchen and bathrooms.
Kitchen and bathrooms. If you are unable to do a complete remodel, consider cosmetic upgrades such as painting the cupboards, fitting new handles, adding open shelves, a new stove and appliances, new bathroom fittings, new mirrors and new towels.
Doors and bedroom cupboards. Another cost-effective way to upgrade is to change the door and cupboard handles given that there is now such a wide choice available. If the cupboards are old, you can repaint and modernise rather than replace.
New lighting and window coverings. You can also consider upgrading exterior and interior lighting to modernise the home. Upgrade your curtains or add American shutters or wooden blinds. You could also change from kirsch rails to rods to give it a modern touch.
Convert your patio into a braai room. If you have a patio, consider enclosing it and adding a built-in braai, and sliding or stacking doors to open it to the garden. This will enable you to enjoy year-round braai get togethers regardless of the weather, and add value.
Update the garden. Aside from general maintenance, you can add outdoor pots, or paint your pots or old garden furniture to give it a new lease on life. Adding pathways and garden décor can add interest to the garden.
https://www.property24.com/articles/what-factors-influence-a-homes-worth/32173
Author: Property24