A house is generally more complex to value than an apartment. Although unique, its value can be determined on the basis of a number of objective criteria. Let’s take a closer look at what you need to take into account to know how to value a house.
Basic criteria: location and volume
A property’s value is primarily determined by its location and size. Is the house located in a sought-after neighborhood, or one that’s not in demand? Is it within walking distance of public transport? The number of rooms, bedrooms and bathrooms, as well as the number of square feet in the house, are also important criteria for comparing properties. The best references for determining a home’s value are the actual sale prices of recent transactions in the neighborhood. These can be obtained from your real estate agent or from the land registry.
Elements that add value
Over and above the criteria of location and volume, the house can gain in value from the advantages of a converted or convertible attic or basement: even if these surfaces do not have the same value as a square foot of living space on the first floor or standard upper floor, they give the house an additional value that can be estimated at a quarter of the price per square foot. The house is well established on the plot: a detached house sells for at least 10-15% more than a semi-detached house, depending also on its exposure to the sun. The plot is large: the larger the plot, the higher the value of the house, bearing in mind that the price per square foot of bare land is degressive. The house is fitted with modern equipment: properties with good insulation and energy-saving features benefit from an increase in value based on lower energy bills.
Some disadvantages that affect the price
The house is located on a busy thoroughfare: the more the house is located on a busy street, the greater the impact on its value. Properties on busy thoroughfares sell for at least 10% less than those on quiet streets. The absence of a garage: selling a house without a garage reduces its value. If it’s possible to build one, it makes sense to deduct the cost of the work from the price of the house. If not, it’s customary to deduct the price of a parking space in the neighborhood. The exterior of the house lacks character: while it’s easy to add character to your interior, it’s more complex and costly to modify the exterior of your home. That’s why houses without character are sold for at least 10% less than houses with character.
The impact of work on the value
Whether the house is to be renovated, fitted out or simply refreshed, it’s always difficult for the buyer to imagine the result and the final bill for the work. To take this element of depreciation into account, a simple technique is to ask for quotes to quantify the work to be carried out and deduct this cost from the estimate for the house in its current state. This method also makes it possible to justify the price reduction to potential buyers.
Although determining the value of a house is complicated, the best way to estimate it is based on recent sales prices in the neighborhood, its location, its volumes, its potential, its strengths and weaknesses.
Source : https://www.logisquebec.com/