While some home buyers rely on love, at first sight, that kind of chemistry is hard to quantify. Luckily, there are some objective criteria most realtors – and most buyers – use when measuring the value of a home. If you aren’t sure about the value of your home, there are a few elements that will go into pricing strategies. Typically, these elements will vary on a case-by-case basis, but there are a few common characteristics that will contribute to the value of a home across the board. Below are five major elements that will help determine to price when listing a home for sale.
Location, Location, Location
Unfortunately, this is one component of pricing sellers won’t be able to easily influence. Location is based on several factors. Walk-ability, for example, is a measure of whether or not stores and restaurants are within easy walking distance. Having good schools in the area is another factor. Then there are crime statistics, the average commute to the nearest metro area, and the cost of comparable homes in the neighborhood. While you can’t change the location of your home, it’s important to be aware that the location can be a great selling point in and of itself. When pricing the home, consider the surrounding amenities that could make the property more valuable.
Square Footage
This is another characteristic that you might not have much control over, but unlike location, there are some tweaks homeowners can make in this department. One way to add to a home’s square footage, and therefore its value, is finishing the basement. Another way to increase square footage would be to build an addition—this is an expensive update, but can also add long-term value. After you examine the physical location, you can assess the value of the home based on the actual home size, number of bedrooms, and yard space.
Updates and Upgrades
Here is the element that homeowners have quite a bit of control over. If your home is outdated either in style or function, that will lower the value of the home overall. Any updates made to the home will help to justify a higher price. Kitchen and bathroom upgrades in particular tend to add the most value to a home. However, they are also the most expensive rooms in the house to renovate, so prospective sellers need to walk a fine line between having an appealing, modern home and spending more than they will recoup in upgrades. According to the home professionals of A Plus Quality, who offer air conditioning service in Toronto, modest upgrades, such as new cabinet doors, energy-efficient appliances, and updated counter-tops and fixtures, as well as a new coat of paint, will provide the biggest bang for the buck.
Curb Appeal and Landscaping
First impressions are important. Studies have shown that a well-landscaped home sells for a higher price, and that yard upgrades can easily pay for themselves. New sod, well-maintained flowerbeds, and an appealing walkway can all add to a yard’s appeal. It is also important to trim existing overgrown bushes and trees. While a well-manicured yard will add to the home’s value, you must be careful not to overdo it. If the yard is too elaborate and will require a lot of intensive work for the homeowner, that can be a deterrent to a potential buyer. Finding the right balance of a nicely groomed yard that won’t require extensive labor for the homeowner will help drive up the value of the home.
Overall Soundness
If your home is overall “sound,” it means that major, expensive fixes won’t become the buyer’s responsibility. This includes a roof and windows that won’t need replacing within a couple of years. It also includes making sure that the HVAC, the water boiler, the plumbing, and the electricity are all in good working order. Buyers don’t want a lemon, and responsible sellers will make sure their home is in good repair before putting it on the market. This is why little updates here and there over the years will really pay off if you are planning on selling. If the potential buyer can find little to no issues with the home, you’ll be able to value the home much higher than if you’re trying to pass off a home that will need a lot of TLC (and money) in the next few years.
While it may be difficult for buyers to implement all of these changes prior to selling their home, even minor fixes in these areas can yield big returns. Some paint, some sod, and some basic home repairs can be just the polish a home (and a buyer) needs. Even if you aren’t planning on selling your home for a few years, you can see the value of good maintenance. Taking good care of your home and investing in repairs will help you reap a greater reward in the end when it comes to pricing your home. Any updates you can make to your home, no matter how small, will contribute to the overall value and will be worth the investment when it comes time to sell.
