In this blog, you’ll learn which factors to consider when evaluating your house’s value. Factors that determine a house’s value range from the square footage and the age of your home, to its location, construction quality, architectural features, and even the number of bathrooms it has.
The quality of the neighbourhood is a significant factor that contributes to the house’s appeal. For examplem having a school of quality within walking distance will raise the value of the houses in that neighbourhood.
Another factor that contributes to a house’s value is the property’s proximity to essential features. Houses that are close to shopping centres (grocery stores, markets, malls), highways, etc are more appealing, and therefore worth more.
Finally, it is more appealing to be closer to work! It’s a bit redundant to say, but commuting is a hassle! Living close to a metropolitan centre is pricey, which is related to career opportunities. If your home is in a metropolitan center, there is a significant difference in value for a home in a smaller city – even if the features of the house are comparable.
As mentioned before, the house’s value also depends on the street or neighbourhood the house is located in. There are four factors that can help you determine which houses are of comparable value to your own.
- Recency – Using a real estate software of your choice to find the price of houses in your neighbourhood that have recently sold. The housing market will affect the value and the price, and it can fluctuate over time, so using the most recent selling price of the comparable is important.
- Feature and Property similarity – Finding a comparable that is similar to yours requires that the two houses have comparable features. Look to compare, for example, the style, the year built, number of bedrooms, bathrooms, and square footage.
- Distance – Try to choose a house that is close to you! If you can, within the same subdivision is best. Often, if the subdivision is different, they may have different school district catchment boundaries, or Homeowner Associations (which are not very common in Canada, but are popping up in newer, urban and suburban subdivisions).
- Location – Look for comparables that are situated in a similar placement. For example, if you’re located on a busy or main street, have a water-body view, back on to a park or a golf course, etc., compare a house that is as well.
Keep in mind...
It is very difficult to find a house that is perfectly comparable to yours, so don’t expect your house’s value to exactly match that of the comparable. Think of the comparable as a useful guide to get an idea of what your house may be valued at.
It is important to note that the value of your house is not set in stone. An increase in value can be induced, depending on how much money and time you’re willing to put into renovating the house. Tip: When preparing to sell your house, painting the walls a neutral tone will appeal to potential buyers. It would not change the value, but sometimes it’s hard to look beyond the superficial features. A fresh coat of paint can go a long way!