A house is probably one of the most expensive purchases you will ever make. Therefore, you should always be in the know of the value of your property.
Several factors, including its location, size or square footage, close amenities, and the number of bathrooms and bedrooms, come into play when valuing a property.
However, these parameters are way beyond the homeowner’s control.
Fortunately, as the homeowner, you can make some changes to improve your property value. For instance, completing repairs and renovations can pay off variedly.
However, letting your house lose its appeal is a sure way of decreasing its value. This isn’t to say that the house can’t be sold.
Cash buyers, such as Mill City Homebuyers, won’t hesitate to buy it, but its value will be low. Below are the top factors that can devalue your property.
1. Neglected or Deferred Maintenance
Neglecting your house’s maintenance is the quickest way to make it depreciate. For instance, a small leak from your water heater may seem ignorable until the leak cracks your foundation.
Even if your household systems and appliances function well, they should be maintained regularly, and any equipment that breaks down should be replaced immediately.
Inspecting your home regularly is the best way to assess its various components.
You can go by the Healthy Homes Maintenance Checklist issued by the U.S Department of Housing and Urban Development to ensure that you don’t miss out on any potential problems.
Common Issues That Can Threaten Your Home Value Include;
- Old heating and cooling systems
- Decaying wood
- Leaky plumbing
- Cracked foundation
- Missing roof shingles
- Termite damage
- Cracked driveways
- Exposed electrical wires
2. Comparable Listings and Foreclosures or Short Sales
The real estate market fluctuates, and you will struggle if you try offloading your house during real estate peak, where the market is flooded with properties for sale.
The more available and comparable homes are in the market, the more difficult it becomes to sell your house at its particular value.
Similarly, increased foreclosures or short sales in your neighborhood is another threat to property value. Foreclosures can devalue your property by skewing to match with other sales in the neighborhood.
For instance, suppose your house has four bedrooms, three bathrooms, and is 1800 square feet.
One similar house recently closed for $390,000, another for $400,000, and a third foreclosed for $280,000. The foreclosed home will significantly affect the prices and can potentially reduce the value of your property.
Having foreclosures or short sales in your neighborhood affects the value of your property.
Even if the foreclosed home isn’t directly comparable to your property in terms of square footage or the number of bathrooms and bedrooms, they can depreciate the price if they are in your immediate neighborhood.
Buyers will hesitate to buy properties in areas with foreclosures because they can’t be sure if the value will stabilize.
3. Shoddy Workmanship
Poorly constructed houses or mistakes made during renovation also directly affect your property value, especially when the final appraisal is done.
Most of these errors occur because the DIY homeowner or the contractor tried to save money during construction, renovation, or repair.
Homeowners should know that each repair can be an additional expense that buyers may negotiate against during the sale.
Buyers will always scrutinize every home addition, including kitchen cabinets, for functionality. Shoddy workmanship can easily be uncovered in;
- Crooked tiles
- Warped floors
- Awkward installations
- Uneven railing and decking
- Inadequate wiring
While buyers will scrutinize every inch in your house, most people focus on the kitchen and bathrooms. Most homeowners remodel their kitchen and bathrooms before listing their properties, hoping to increase their value.
However, this isn’t a certainty. Renovations in the kitchen that can meet success include countertops, cabinets, and the sink. Outdated or stained backsplash and countertops can detract from your home’s value.
4. Poor Landscaping or Curb Appeal
Landscaping and general curb appeal are also important when selling your house.
The first thing that potential buyers see during a house tour is your external curb appeal.
Selling your home becomes difficult if landscaping isn’t among your priorities.
Old sheds, rotting fences, unkempt ponds, or waterfalls can decrease your property value.
Many other factors, such as bad neighbors, excessive personalization, and building code violations, also make it impossible to close the sale at your desired market value.