When you are investing in a property, it is important to have a vision of the value of the property. So the question always remains – how much is the property worth? Even if you are selling or buying, investing or thinking of investing, it is important that you have an answer to this question. There are so many factors that, over a period of time, can affect and determine the value of a property. Take a look at some of them:
Believe it or not, the location in which the property is located has a major impact on its worth or value. In fact, one can say that it is the most obvious factor that a person should consider when investing in a property to measure out its long term value. The property that is located strategically close to important landmarks like the center of the city, the railway station, airport, recreational spaces, schools, colleges, grocery stores, etc is going to be valued a lot more as compared to a property in the suburbs. Another factor to consider when looking at location is that a majority of people prefer living close to their workplace so they can maintain a work-life balance. That is why, the properties in the above-mentioned areas will be valued more and tends to be expensive.
Size and Facilities
Another major factor that affects the value of a property is the size and the facilities that come with the property. If you invest in a 4BHK home, it will give you more returns compared to a 1BHK home in the same society. Along with that, add in certain features like spacious living area, extra bathroom, dry balcony, clubhouse and swimming pool in the society, etc and the value of the said property will definitely increase. As the times have changed, things like a proper parking space or a covered parking space are also factors that determine the value of a property.
When you live in a country, you automatically become a part of its economy. The value of property is always determined by the economy and the growth experienced by the economy of your country. If the economy is experiencing strong and steady growth, more people will be able to purchase property. This is one major factor that determines the value of property.
The Age and Condition
Another one of the obvious factors is the condition of the property and the amount of time that has passed since the property was first completed. Usually, a lot of new investors and home buyers would prefer new properties over the old ones as they require very less maintenance and have all the modern facilities that old homes and properties do not have to offer. Another factor here is the condition in which the house is so contrary to the point mentioned above, old homes are sometimes built in a way that they withstand time. If that is the case, an old house may be in a better condition compared to a new one and has stood the test of time. In that case, people would prefer that old house compared to new ones. These factors, with time, influence and affect the value of property.
Supply and Demand
One can say that this is THE major factor that affects the value of a property. Every market, just like the seasons, goes through trends and these trends decide the supply and demand wave of a said time. If, in the real estate market, there is a high demand for a particular kind of property but the supply for the same is less, the value of that property will automatically increase.
Apart from these factors, other factors like interest rates, renovation potential, planning and building regulations, aesthetics, etc are some of the factors that determine the value of a property. A true investor or home buyer would study the property from all these aspects before making an informed decision about which property to invest in.