Determining How Much Your Property is Worth
For many homeowners, a common question that arises is, "What would my property be worth if I decided to put it on the market?"
The process of gauging a property's value is multilayered, involving factors such as property valuations, appraisals, the property's condition, and the broader economic situation.
Knowing your property's value is crucial when selling, as it enables you to set an attractive price to entice potential buyers. Even if you're not planning to sell right away, keeping an eye on property values in your neighbourhood is a wise move.
Let's delve into the key aspects of how property values are assessed.
Understanding your market
In New Zealand, the real estate market is influenced by elements like housing supply, demand, population growth, and government incentives. These variables can lead to fluctuations in the market, and these variations have a significant impact on property values. The market is often characterised as either a seller's or buyer's market, and this distinction can greatly influence the perceived value of your property.
Seller's market
A seller's market occurs when there are more buyers than available properties. In such conditions, sellers have the upper hand in negotiations, and properties tend to sell quickly, often fetching prices at or above their listing. Competition among buyers is fierce, and sellers might even receive attractive pre-auction offers.
Buyer's market
Conversely, a buyer's market is marked by an abundance of available properties and a limited number of buyers. In this scenario, buyers have more room for negotiation, and properties may linger on the market for an extended period.
In a buyer's market, sellers may need to be more competitive to meet the market and may have to accept lower sale prices to attract potential buyers. They might also need to make concessions such as property repairs or strategic staging to stand out in a crowded market.
If you're unsure about the best approach to selling your property, it's advisable to consult with your local LJ Hooker real estate agent, who can offer guidance based on the current market conditions.
Factors affecting property value
Besides market dynamics, several other factors play a role in determining your property is worth.
- Local property prices
Recent sales of similar properties in your area significantly influence your property's value. Ensure that you compare properties with similar features, including size, number of bedrooms, and amenities.
- Location
The location of your property is a key determinant of its sale price. Factors like proximity to good schools, access to public transportation, and views can enhance the property's value.
- Property condition
The overall condition of your property, whether it's well-maintained or in need of significant repairs, affects its value. A well-kept property generally commands a higher price.
- Property size and layout
The size and layout of your property are crucial considerations. A property with ample space, a well-thought-out layout, multiple bedrooms, and a large section is more likely to fetch a higher price.
It is also worth noting that layouts can influence the value of a home. This is simply because prospective buyers will not pay top dollar for a home where the kitchen is not centralised, and the distance between the bedrooms and bathrooms is considerable.
Whether to renovate before selling is a decision that needs careful consideration. Remember any upgrades should only be done to attract more buyers and add value. It can’t be done with your tastes in mind but what the market expects. Always speak with your local agent who can advise on changes that will help to boost the sale price of your property.
Property valuation vs. property appraisal
When determining your property's value, you can seek two types of assessments: a property valuation and a property appraisal.
Valuation
A Certified Practising Valuer takes various factors into account, such as property condition, land size, number of bedrooms, zoning, and planning restrictions. Valuers provide a comprehensive report, often including the rental value of the property.
Appraisal
A property appraisal is typically provided by a local real estate agent who considers local market insights and buyer interest. Agents, with their knowledge of the local property market, offer valuable data and research to help you gauge your property's worth.
Determining your property’s worth with LJ Hooker
Selling a home is a monumental task that holds immense value for homeowners. As the largest asset for many, homeowners strive to achieve the highest possible price that accurately reflects the true worth of their property.
Determining the value of a property is a multilayered process that requires careful consideration of various factors. From market trends to property features and layouts, everything must be taken into account.
When it comes time to determine your property’s worth, engage LJ Hooker. The LJ Hooker team offers experience and excellent market knowledge. All of which combine to provide sellers with invaluable insight. For the most accurate assessment of your property’s worth, contact LJ Hooker for a property appraisal.
