How to determine the value of your home

posted by Reef Hickley

How to determine the value of your home

 

Knowing the value of a property is an important part of the negotiation process for both buyers and sellers. Various factors play a role in property valuation, and it’s helpful to get an overview before putting your home up for sale.

 

What counts in property valuation?

 

- The price at which other similar-sized homes in the area have been sold.

- The price that the property in question was last sold for.

-  Current market conditions.

- The location.

- The age, size and condition of the home.

- Aesthetic elements such as kitchen design, flooring and furnishings.

- The quality of views from the home.

- New renovations that add appeal.

- The size and state of the garden, if one exists.

- Security features.

- Local infrastructure – proximity to schools, shops, recreational facilities and public transport

 

Ways to conduct a valuation

 

- Hire a professional

 

Estate agents can provide a CMA (Comparative Market Analysis), which will take into account market forces along with the value and selling price of other properties in the area. These experienced professionals have an understanding of the property market and the pertinent factors that impact property valuation. In addition to providing an estimated property value, estate agents can also advise property sellers whether they should attempt to sell above or below market value, and by what margin.

 

- Use online valuation tools

 

Online valuation tools can be handy to figure out property trends throughout South Africa. These often display both seasonal and long-term changes in property prices and sales.  To access useful stats, just enter the suburb you wish to analyse. The breakdown can include:

 

- Average asking price.

- Total properties for sale.

- Number of properties on the market per month.

- Sold properties.

- Who owns property in South Africa.

 

Market value versus selling value

 

If you’re the seller, you cannot assume that the property price will end up being the same as your perceived selling value. Various factors affect a sale, such as whether we’re in a sellers’ market or a buyers’ market. For example, if South Africa is experiencing a buyers’ market, which means the supply of luxury homes is exceeding demand, a seller may be forced to price the home well below the perceived value in order to offload it.

 

For home buyers, the market value is a useful guideline for negotiating your offer to purchase. You don’t want your offer to be too far below market value, but an estate agent can advise you on your chances of securing a bargain deal.

 

Keep in mind    

 

If a house looks refurbished, clean and well-maintained, and it boasts tasteful, modern decor, finishes, then it can have a much higher commercial appeal to a much wider audience, and you may be able to enter the market with a slightly higher asking price.

 

And, when it comes to establishing the market value of your property, location can also be even more important than aesthetic features, or the size of your home.