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How Real Estate Agents Determine the Value of your Home

If you want to sell your property you would be interested in first having a professional home appraisal done to determine the true market value of your home or property based on current market analysis. One great way of valuing a home is to get professional estate agents that work in that locality to value the house. It is important to get the valuation of your home right because you would be cheating yourself out of some revenue if you under price the property and would find it difficult to sell the property if you over price it.

To get the right estimate or value of any property, real estate agents take cognizance of several factors. Factors such as market analysis, location of the property, home amenities and several others are all weighed in to get the right value. Here is a break down of the most important factors that a real estate agent would use to determine the value of your home.

Location

The location of a property is an important determinant of its value. Properties in cities that are well developed with urban facilities would cost more than properties in semi urban or country areas. The nearness of the property to train stations, schools, business districts, airports and other public amenities affects its value positively. The closer it is to such amenities, the more expensive it would be. That is why almost every city has a low end and high end area depending on the value of properties in the area. Properties that are closer to public amenities and business districts are more sought after and the high demand drives their value upward. A real estate agent would thus have to factor in the location of your home when doing a home appraisal of its worth.

Home features

This factor has to do with the actual features of the home being valued. What style is the building built in? Some building styles are valued higher than others. Does it come with marble finishing, tile flooring or is it paneled with expensive lumber? What is the size and age of the property? What makes it unique or special? Does the home have any special views?

Home condition

The condition of the home would determine its value and how fast you can sell it. A home in good condition that can be bought and moved into immediately would cost more than a home that requires some form of repairs and improvements. The more repairs or renovations that are needed, the lower people would be willing to pay for the home. Factors that determine the condition of the home include condition of the floor covering, paints, ceilings, doors, windows and doors. Buyers would usually pay extra attention to the condition of plumbing fixtures, kitchen, bathrooms and electrical work.

Home improvements

This factor weighs in the presence or absence of little extras that can increase home value. These extra improvements include fancy fittings and additions to the home. Adding extra rooms or the availability of floor tiles are good examples of home improvement extras. Other includes the availability of a swimming pool, garden and any improvements made to the kitchen, bathroom and bedrooms. Other home improvements that can affect home values include sophisticated security systems and a garage.

Prevailing market conditions

This is another important factor that would affect the value of your home. The law of demand and supply plays a vital role in property valuation. When there are many properties available for sale within an area at the same time, the asking price for properties would decline. The opposite is the case when there are fewer properties than buyers, the price would increase. The prevailing real estate market conditions thus affects home valuation. Even the state of the economy plays a role. During a recession when there are job losses, more people would try to sell off their property and fewer people would be able to afford to buy the properties causing the values of homes to drop. The real estate agent would have to carefully conduct market analysis to determine prevalent and expected market conditions when estimating home values.

Seller’s motivation

The seller does play an important role as they own the property and to a large extent have a say in the price a property is sold. The real estate agent can make a professional home appraisal to determine home value, but the buyer can insist on a price higher or lower than that. For example a seller who is eager to more or dispose the property can be willing to accept less that the worth as defined by the professional real estate agent. The buyer could also stubbornly insist on a predetermined value and may be willing to wait till market conditions become favorable for a sale. The seller is thus a factor worth mentioning.

Marketing skills

Some real estate agents are good in what they do. They have the right contacts and know how best to present a property so that it commands a higher price. The marketing plan and skill of the real estate agent is thus a factor that would determine the final home value for which the house is offered. It is thus important that you get a professional real estate agent to do proper home appraisal for your property and get you a good value for it.

A common misconception to avoid

The worth of a property doesn’t always depend on the value or amount that the property was originally bought. Home values can increase or decrease over time based on many factors which would include many of those mentioned above. Some sellers expect their home worth to be above that which they paid for the home. This may not always be possible as the condition of the home, depressing market conditions and changes in the locality may have reduced the value of the home. Present home values may also be higher than the original amount paid for the properties. A real estate agent would be able to do a market analysis and use the above factors to determine a realistic home value for your property.

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