You don't have to be in the market to learn more about your home or any other.
A home valuation helps you gain a better understanding of what a home is worth, and which factors are in place to support that value. It's not the same as an appraisal, although they do perform similar functions. Above all else, it is a tool.
You can learn the value of any home that you like, or you can get a little more information about how your home stacks up against others in your neighborhood. Any home is a candidate for home valuation, whether or not it's on the market.
If you're ready to learn more, here are the most critical components of any home valuation:
#1: Location, Location, Location
The three classic, critical factors in any real estate are location, location, and location. Some may argue that point, but those are personal preferences. For valuation purposes, it's classic because it's true.
The neighborhoods surrounding any property aid the valuation process because they reveal what similar homes nearby have sold for. This is often referred to as a 'comp,' or comparative property, which is a factor that real estate agents use when determining the fair price for a home.
When property is in high demand, the market reacts with an uptick in value.
#2: Local Housing Demand
If you've ever perused real estate listings in other towns just for fun, you might already know how similar houses in two different areas can have radically different values. Housing demand is a big reason why. In fact, Investopedia suggests that demand plays a major role in value.
When there is little demand for property in an area, the market is weaker. Take New York City, for example. Demand for apartments is incredibly high, which means buyers eagerly pay top dollar for a tiny space and nothing stays on the market for very long. Conversely, in a rural area a 4-bedroom house might sit on the market for months and cost one fourth of the price of a city apartment.
#3: Square Footage and Amenities
A tiny home with an equally tiny yard obviously isn't valued as high as a grand home on an expansive corner lot. And a home with a modern kitchen, spa-like bathrooms, and a swimming pool will naturally value higher than one with just a gravel driveway and a picnic table out back.
Square footage and amenities factor high in a home valuation, in a similar way as they affect a local tax assessment. Where the basic footprint is larger and the amenities are in-demand, the value of a home is likely to be a bit higher than other properties nearby.
Curb appeal can have a dramatic effect on home valuation.
#4: Age and General Condition of the Home
In some areas, age is a definite bonus. Historic properties are a perfect example. A classic Victorian that sits in a historic district or an immaculate New England salt box home may value quite high. On the other hand, age can be a drawback. Some homes look dated or simply aren't as popular with buyers for myriad reasons.
The condition of the home can be its saving grace or its downfall. And although a valuation is not an appraisal, recent photos can show whether it's well maintained of if it needs work. Bad siding and a worn roof mean any buyer would need to invest money for repairs up front.
A home valuation lets you or anyone else learn more about the vital statistics of any home. Location can hinge on great schools in the area. Demand can make even an unattractive home more inviting. There are numerous factors that go into determining what a house is worth, and the comparative properties play a big role in that.
If you're in the market for a new home, or just want to learn a little more about your own house, Click here for free property valuation. In just minutes, you'll have access to information that can help you plan whatever your next step happens to be.