8 Great Dangers to the Value of Your Home
Do you know what your home is really worth? Probably a lot more to you, than to a potential buyer. I mean this is where your kids have grown up, or where you made DIY repairs with success. However, chances are the potential buyer could be thinking more about granite counter tops and location, than about the fond memories that had made your house priceless. Whether you are thinking about selling or not, it doesn’t hurt to know what could have an impact in your home’s value, whether positive or negative. So, we researched and found 8 dangers to the value of your home. Tread with caution!
Danger Level: High, some have reported 50% or more
We are all familiar with the phrase “Location, location, location”, and there is a reason for that. It will probably be one of the most dangerous hurdles for a home’s value. You could build an extravagant home, but the odds are if it is in an undesirable location, the price will plummet.
Although you have most likely considered location when you bought or built your home, something may have changed since then such as rezoning, an increase in crime or a new city dump.
Are you out of luck? Well, that depends on what about your location is bringing down the value. If you have a view of the city dump, you can plant some privacy hedges to make it less of an issue. Maximize your home’s strengths, and make sure your curb appeal is stunning.
2. Bad floor plan
Danger Level: Medium to high, up to 25%
Odd floor plans are considered critically when appraisers are looking at the home. An open floor plan is a ticket to a good value, but anything unusual is not smiled on. Nowadays, buyers are more critical. Keeping it open and clean can attract, rather than turn away.
Appraisers can usually classify the more unusual floor plans as a functional problem and determine value based on the market. People have reported seeing a bad floor plan reduce an appraised value by as much as 25%.
3. Lack of updates
Danger Level: Low to medium, at least 10%
Seeing that home stock that is really high this year, buyers can afford to be picky. They want granite countertops, and updated appliances. Fortunately, you have an option to fix this easily. For between $5,000 and $8,000, you can install granite countertops, update the light fixtures and add fresh paint and carpet. Doing this, you can likely get a return of $15,000 to $20,000 when it is time to sell. Of course this can change depending on your market.
4. Swimming pool
Danger Level: Varies
A swimming pool can be a gray area for your home value depending on your market. If you live in a hot climate where having a pool is an expected feature, you might want to consider it as that will add value.
However, in regions where pools aren’t common, a buyer must consider children and safety rather than relaxing and floating.
5. No garage
Danger Level: Varies, about $5,000 per stall
A garage can definitely adds value to a home, but the key is to have the right-size garage for the home. If you have a one-car garage in a 1,100-square-foot home in a lower income neighborhood, there’s a big value added for that. However, if you have a one-car garage in a million-dollar home, that’s a functional problem. The added value for a garage can vary by neighborhood, but a good rule of thumb is $5,000 per stall.
6. Rental properties
Danger Level: Medium, up to 15%
People don’t want to live near a bunch of rental properties since an area that is saturated with renters can affect a home’s value by as much as 15%. But it’s not the fact that there are rentals in the area that turns off buyers, it is usually because there is a stigma that people who rent tend not to maintain the properties as well. Absent owners tend to not maintain properties as well.
Although you can’t change the number of rentals in your neighborhood, you can maintain a good relationship with landlords and tenants, and you can volunteer to help with upkeep and maintenance of those properties.
7. No fence
Danger Level: Low, 5% to 10%
Porches, decks, or any nice outdoor space should be fully utilized, especially if your home sits in a desirable climate. Buyers will almost always be willing to pay extra for a bonus outdoor feature.
Danger Level: Low to medium, up to 15%
A little mold has been known to cancel contracts. Although buyers may be able to easily get rid of it, if they have an allergy, they will be quick to back out. Other problems may include cigarette smoke and pet dander.
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