When valuing your home, there are a number of factors that should be taken into consideration.
The first place that many people turn, to work out the value of their property is online. There are plenty of property valuation websites that claim to be accurate, but these should be taken with “a grain of salt” in ascertaining the value of your property.
Property value websites take into consideration property attributes (i.e. bedrooms, bathrooms, car parking and land size) plus recent sale prices in the area to give you the estimate. While these are very helpful, the data is often old, there are errors in it, and markets can change in that time. Also, the sample size of data these sites extract from can be small and/or erratic, under-valuing or over-valuing your property. For instance, sales within families, properties with major issues, or unusual properties are factors behind this data variance.
Another area of variance is the real estate sales agent. Property owners that have done their homework and have chosen an agent that is great at marketing to buyers and is a superior negotiator will gain a higher sale price. Conversely, an agent who is unskilled and inexperienced will negatively impact the price.
There are also a number of other influences you should be aware of with property values:
External influences such as interest rate announcements or government changes to taxes or property incentives greatly influence the property market. These are obviously implemented to stimulate different market segments or put pressure on other segments, creating swift change that can be seen very quickly in the property market.
Supply and demand
Low supply of properties with a large amount of buyer demand pushes property prices up. For instance, if there is a large number of buyers in the market for 4-bedroom homes, with little supply of 4-bedroom homes, this competition between buyers will push prices up.
Conversely, if there is a large supply of homes in an area with a smaller number of buyers, this competition for buyers lowers prices.
Desirable property attributes
Properties with desirable attributes command higher than average prices. For instance, buyers more likely to pay a premium for:
- Multiple living areas.
- Outdoor area that includes dining, BBQ and/or outdoor living.
- Pool and/or spa.
- Great views.
- Theatre room or games room.
- Large garaging and workshop space.
- Good quality of materials throughout the home.
- Great quality, well-designed kitchen with top grade appliances.
- Property that is located in the catchment area of a highly desirable school.
When it comes to getting an accurate value of your home, it is best to look at multiple areas to get an estimated sale price. You should also talk to a local experienced real estate agent that specialises in your area to get their view on your property’s value. Also ask them what is happening in the current market that is influencing values.
At Harcourts The Property People we have many highly skilled agents on our team. Contact our office on 4628 7444 to find the best agent in your area.