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What Factors Affect A Property’s Value?

When you plan to buy or sell residential property, knowing its value is crucial to getting a good and honest deal. Usually, people think the value of a house or unit is based on one or two things, but there are several factors that contribute to a property being highly attractive for buyers and investors. As a residential property owner who is ready to sell or someone who is looking for a home or a property for investment, you should know what factors influence a property’s desirability in the market. Thus, here is a complete guide by expert property valuers in Australia outlining the most important characterises that make a house or unit valuable.

Property’s Layout & Size

The layout and size are two real estate assets that greatly increase or decrease a property’s value. The rate of a house or apartment is determined by the price per square foot. This metric is the best for the valuation of residential properties whether you are buying or selling them. In addition, the number of living rooms, bathrooms, kitchens and the general floor plan of residential property all impact its market value.

If a house is big but its floor plan is poor, its value will not be the same as a house or unit with less space but a better layout. Any property up for sale or rent should be practically designed and to get the best price it should meet the requirements of potential buyers or renters.

Renovations, Refurbishments and Additions

Before selling a property or putting it up for leasing, owners make improvements to increase its value and curb appeal. For buyers and renters, a property that is renovated or refurbished to make living in it easier and comfortable is valuable and desirable. For example, a house for a single family that has the space and improvements to make it safe for children will be better than a house that lacks the necessary additions.    

Although the additions and renovations don’t add the same value to the property as the money spent on them. But, they make a positive difference and attract more buyers and renters to the property.

Property’s Condition

A property in a good and clean condition will always attract more buyers and renters than a property that is poorly maintained. During inspections, property valuers usually check the property’s structural integrity, cooling or heating systems, plumbing and other things to decide its worth. It also helps property owners know what they need to do to increase their property’s worth. For example, if a house has an obsolete floor plan and the buyers get it changed to a modern one then the property’s desirability increases which impacts its value greatly.  More people will be willing to invest in such a property and offer higher prices for it.

Property’s Age

It is a no-brainer that newly constructed residential properties have more value than used houses and units. A property’s age impacts its value because the new homes require fewer repairs and maintenance. Plus, they guarantee better structural integrity and their floor plans are more attuned to modern trends. These new innovations make this property more valuable and people find it a better fit for them.

Property Market Condition

Besides the property’s condition, the state of the real estate market also plays a major role during the valuation process. Due to the outbreak of the COVID-19 pandemic in the year 2020, the property market has seriously impacted the values of houses and units dropped. However, in 2021, the market has regained mobility which has also affected the prices of residential properties across Australia. You have to know the current market situation you are in to understand and estimate the property’s valuation or you can hire property valuation services about the same. 

Neighbourhood & Surroundings

Naturally, a property in a safe neighbourhood with families and established communities will have more value than a house or unit in a mediocre neighbourhood. The crime and justice statistics, image, people, schooling and several other things impact a neighbourhood’s desirability. For example, a well-built house’s value in a neighbourhood with multiple vacant homes, graffiti, a high crime rate etc. will suffer because of these factors. Neither renters nor buyers are usually interested in investing in such properties and will not offer a good price for it.       

Location

It is common knowledge that a property’s location is a major factor that increases or decreases its desirability. Well-located properties always have higher market values than properties that are good but located in areas that are not as looked-for. For example, residential properties in Sydney are valued more than properties in other metropolitan cities like Brisbane, Adelaide or Perth because more people are interested in living in an international city.

The Bottom Line

When you buy or sell a property, it is essential to know its true market value. The factors mentioned above impact the desirability of properties tremendously and you should know them to make an informed decision. Additionally, hire property valuation professionals in Australia, if you lack the knowledge and expertise to evaluate the right price of a house or unit. They will help you get the exact and correct prices for the property and also give you knowledge of the current market.   

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