How much is my house worth? Everyone who wants to sell their property has asked themselves this question at least once, and uncertainty about it drives most of us around. Whether due to a job-related move or a divorce, the reasons for selling a house can be very diverse. Yet the goal is actually always the same: It should go as smoothly as possible and we want to get the highest possible price for our property. In order to sell at a fair profit, there are some important steps to follow. First and foremost, of course, we should have the house value determined. How to go about it and what can you do to increase the market value? We’ll reveal all that and much more right below!
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How to determine the value of a house?
Determining the house value is undoubtedly one of the most important measures when selling a house. It indicates what market price we could hypothetically achieve. Since the calculations require precise knowledge and are quite complex, it is worth hiring a competent and experienced appraiser or real estate agent for this purpose. In order to determine the value of a property, one relies on three different variants – income capitalization method, comparative value method and asset value method.
To determine the value of a property, the comparative value method compares the building with similar properties. If there is not enough data available, the asset value method is used. Here, the property and the land are considered separately and the house value is determined on the basis of the condition of the building fabric, equipment and year of construction. The capitalized earnings value method, on the other hand, is mostly used for rented properties. The calculation is based on the amount of rent received. Which calculation method would make sense for you depends on the type of property being valued. Often, several methods are combined with each other.
What factors influence the market value?
In contrast to the house value, the market value refers to the price at which we can actually sell our house. There are many different factors that are of great importance in determining this. However, the list is quite long and extensive and in order not to make it even more complicated, we will focus on the most important ones below. In the first place, of course, the location plays a decisive role and here we distinguish between micro and macro location. While the macro location refers to the city or region, the micro location refers to the immediate surroundings and the neighborhood. Are there supermarkets and bus stops in the vicinity? Is it a quiet residential area and how high is the noise level? Are doctors, pharmacies and restaurants within easy reach?
In order to determine the value of the house, the property’s features are of course also assessed. Not only the visual factors, such as garden, balcony, cellar, etc., are taken into account, but also the year of construction, building fabric and energy efficiency. Logically, a house that has a large garden and two floors will achieve a higher value than a small city apartment. The condition of the soil and the quality of the building materials used also influence the value of the house. The worse the structural condition, the lower it will be.
Determining and increasing the value of a house: This is how you can do it!
You want to determine the house value and wonder if you can somehow increase it? There are actually several measures that can increase the asking price. For example, small cosmetic repairs and plants in the garden could increase the value. It is also important to remove defects and signs of use that have occurred over time. This includes, for example, the removal of vermin, a new coat of paint on the facade and maintenance of the heating system. Modernization measures can also help to increase the value of the house. Renewable energy sources in particular have a positive effect on the energy certificate and have a positive impact. In addition to all the above factors, the price level and the current local market situation also determine how much a property is actually worth.