Many of the factors that affect the impact of your home’s value are completely out of your hands, but others aren’t. Which ones affect the price the most? Continue reading to learn about five factors that can have a big impact on how much your home is worth. If you have questions, or you want to sell your home, contact Berkshire Hathaway HomeServices at (310) 373-0021 to see how we can help.
1. Real Estate Supply and Demand
That law of supply and demand that economists learn in their first class plays a big part in how much a home is worth. In fact, it is by far the most significant. You do not have any way to affect supply and demand – but you can decide when to put your home up for sale. Right now, many people are not putting their homes on the market because of COVID – but there are still plenty of buyers looking. In many areas, now is the right time to put up a home for sale.
2. Comparable Sales
Both real estate appraisers and real estate agents will look at the sales price of homes around a home for sale to determine what it is worth. This is because putting a dollar sign on a house is meaningless if no one will pay that much. For example, if a home is listed for $7.5 million but comparable houses are selling for $1.4 million, it will be easy to see that the home is not likely to sell at such a high price.
3. Interest Rates and Other Costs of Borrowing
The lower interest rates are, the more people are likely thinking about taking the plunge. When other costs of borrowing are low, you can expect more buyers – which means lower supply and higher demand. That can translate to big increases in value.
4. The School District
According to one study from the National Association of Realtors, more than 25% of homebuyers are influenced by the school district when choosing a home. This is one reason you might consider looking at the quality of school districts when you are buying, even if you do not have children.
5. Commercial Movement
In California, buyers generally want a lifestyle of convenience. They want to live near a grocery store, coffee shop, and other essential spots. If you find a primary residential area that is about to have some new commercial development, then you might have found a great investment.