What Influences Home Value? The 6 Most Critical Factors

When we think about milestones in life, a decision to buy a property, a house or an apartment would be among them. It’s not just about buying a house; it’s the beginning of a story of building a home for yourself or for your family. A home is your place where you’ll feel safe and where you’ll create a life to your needs and requirements. To make the buyer journey as easy as possible, you have to

understand the various factors that influence property value. Its location or size doesn’t just determine it; rather, it's a complex interplay of considerable variables. That’s why we are about to list the most critical factors so you’ll know how to make an informed decision.

The most obvious - location

This is not just about what you can and can’t afford location-wise; it’s about choosing a location that will support the lifestyle you want to lead. It’s obvious that a location will always be the first one affecting the property value. This is because you have to take into account the following - proximity to amenities such as schools, shopping centres, and recreational facilities. Next, the level of calm or its opposite also plays a role in location value. Some people can live next to a busy road, while others might find that this should affect the asking price. Accessibility to transportation and major highways also plays a crucial role, so carefully evaluate the location by analysing different factors.

Layout and size

The next two factors go together, as size and the layout of the property can give you a preview of your future life at this property. These two have to be carefully considered as they contribute to the quality of life at the place you want to call your home.

When evaluating properties, carefully assess their size, number of rooms, and layout to determine their suitability for your needs and preferences.

Larger properties with more bedrooms and bathrooms generally cost more, as they offer greater living space and accommodation. Additionally, a well-designed layout that maximises functionality and flow can enhance the overall appeal of a property.

Future potential

When we are on the market for such a big investment such as buying a property, we have to think ahead. We can’t foresee the future or how our lives will unfold, but we can consider the future development potential of the area or the property. Even if our life takes us to another location, the future potential of the property will remain. Since this is the case for many suburbs in Australia, as upcoming development projects are changing the landscape, people consult with St Leonards real estate to consider the future development potential of a property. Real estate agents will know how to advise you on this and offer valuable insight, so consider having them by your side during your buying journey.

The assessed condition

There’s a difference between how the property looks and what the inspection uncovers, so be mindful about this one. The current condition of the property will have a significant impact on the price, as you’ll be required to invest to a certain degree. Age, maintenance history, prior or future renovations or upgrades will play a big role in the property’s overall appeal to the market. Well-maintained properties with recent upgrades might have a higher asking price, which is reasonable. Otherwise, properties in poor condition or in need of significant repairs may present room for price negotiations. Before purchasing a property, thoroughly inspect its condition and consider any potential renovation or repair costs.

Supply and demand on the market

Widely looking, current market trends in terms of supply and demand will also affect property values. Supply and demand dynamics, interest rates, and economic growth can all affect property prices. You have to be aware that this is a competitive market, as many people invest in properties in order to flip them and earn. Since this is a significant decision, you can just stay informed about market trends even before you make a final decision to purchase. Sometimes time will be in your favor and waiting might be worth it.

School quality

Whether you’re looking to buy a house to grow a family or just to have one someday, you might want to consider the quality of the schools. the overall education system can have a significant impact on property values, particularly for families with children. Highly rated schools often increase the value of a suburb, thus affecting the value of a property. Other educational systems, such as colleges and universities, can also influence property values. When considering a property, think long-term, so research the quality of nearby schools and consider their impact on the future value of your property.

Lastly, pay attention to factors such as local infrastructure, developmental projects, safety and crime rate, and potential environmental factors. When you start looking into properties with a real estate agent, you’ll learn about other micro factors we haven’t listed, so ensure you have a skilled professional to advise and guide you towards the best decision.

Mike is an Australian business consulting specialist. He’s working with companies that outsource their IT maintenance. He often writes about technology, business and marketing and is a regular contributor on several sites.