There are four main factors that determine your home’s value: location, condition, size and overall appeal, and the market’s absorption rate.
We’re in the middle of the peak selling season for real estate here in Southwest Indiana, which means you may see homes sell in your neighborhood just a few days after being listed.
What’s the value of your home, though? To find out, there are four factors you need to consider:
1. Location. You can’t compare a home that’s for sale in, say, Newburgh with one that’s for sale on the west side of Evansville. Even if you’re comparing two homes in Newburgh, their respective values can be vastly different if they’re located on opposite sides of town. If your home is in close proximity to certain amenities (shopping centers, good schools, etc.), its value also might be higher than a home that’s further out in the country.
2. Condition. A home that’s updated and decluttered is worth more than one that’s a complete mess or hasn’t been changed since the 1970s.
3. Size and overall appeal. For example, a 4-bedroom, 2-bathroom home in Newburgh will be in high demand right now. A 3,000 square-foot home with one bedroom and four bathrooms, however, won’t be because most homebuyers will be looking for at least four bedrooms inside that amount of space.
4. Absorption rate. This reflects the supply and demand of the current market. Right now, our market is hot, which means people are stretching their home’s value in comparison to a few years ago. In fact, we recently met with a seller who bought their home three years ago for $135,000 but is now listing it in the $185,000 to $190,000 range. While this seller did spend about $10,000 on updates, the main reason it’s listed so high is that there aren’t a lot of homes like it for sale at the moment, and values have gone up over the past few years.
If you’d like to talk more about this subject or you’d like to know the value of your home, don’t hesitate to give us a call. We’d be happy to give you a detailed market analysis.