Tag Archives: resale value

How to tell if a home will hold its resale value when buying

Six signs a home will hold its resale value

Most buyers have a wish list of features they’d like to have in a home. Often missing from that list is how salable the home will be when they later decide to sell.

Generally, buyers deal indirectly with resale value. They want a home they can buy at market value or less. They want to buy a home that will retain its value. They want to buy a home that will suit their needs. They want to buy a home they can make their own.

home hold its resale valueA listing that’s priced low to sell fast may be one that will have good resale value only if you use this marketing strategy. The low price may offset an incurable defect, such as a location on a busy street.

There’s nothing wrong with buying a home on a busy street as long as (1) you buy it at a price that reflects the location issue; (2) it suits your long-term needs; and (3) you understand that you will probably have to discount the price accordingly when you sell, depending on the market at the time.

In a hot seller’s market, buyers are desperate to buy. They often overpay, and they are more likely to overlook defects that they would shun in a sour market.

Resale value has become a bigger issue since the housing recession began five years ago. Buyers are more cautious in their home-buying decisions. They don’t want to buy just any home; they don’t want to make a mistake and end up wanting to move in a slow market in which they might lose money.

The homes that hold their resale value well are the ones that appeal to a broad cross section of buyers; offer a good floor plan that works for different lifestyles; have a good amount of space but are not enormous and expensive to maintain; and exhibit a pride of ownership. They should also be in good condition.

Location is also a critical element of resale value. There are market niches that are always in demand, in both hot and soft markets. For example houses in neighborhoods with close proximity to shops, cafés and public transportation systems.

That’s not to say that every listing in these neighborhoods sell quickly. To sell, it needs to be priced right for the market.

It’s easier to recognize a home with good resale value in the current market than it was in the bubble market of 2005 and 2006 when virtually all homes sold in many areas. In a soft market, the homes that sell within 30 to 60 days are either good homes or good deals.

Ideally, you want to buy a home that has good resale value. Not one that’s just a good deal. There’s no urgency to buy now in many areas, although it would be nice to take advantage of record-low interest rates. But you shouldn’t buy a home that won’t work for you long term just to lock in a great interest rate.

Even though there are a lot of homes for sale on the market, in many areas there is a not a surplus of quality inventory on the market. One reason for the lack of quality homes on the market is that many sellers are waiting for a better time to sell. Another reason is that homes with good resale value don’t tend to change hands that often.

THE CLOSING: There may be good news ahead. Leslie Appleton-Young, chief economist for the CALIFORNIA ASSOCIATION OF REALTORS®, predicts that sellers who have been waiting for a better time to sell may decide they’ve waited long enough and list their homes for sale in 2012.

Dian Hymer is a real estate broker with more than 30 years’ experience and is a nationally syndicated real estate columnist and author.

Six signs a home will hold its resale value

Most buyers have a wish list of features they’d like to have in a home. Often missing from that list is how salable the home will be when they later decide to sell.

Generally, buyers deal indirectly with resale value. They want a home they can buy at market value or less. They want to buy a home that will retain its value. They want to buy a home that will suit their needs. They want to buy a home they can make their own.

A listing that’s priced low to sell fast may be one that will have good resale value only if you use this marketing strategy. The low price may offset an incurable defect, such as a location on a busy street.

There’s nothing wrong with buying a home on a busy street as long as (1) you buy it at a price that reflects the location issue; (2) it suits your long-term needs; and (3) you understand that you will probably have to discount the price accordingly when you sell, depending on the market at the time.

In a hot seller’s market, buyers are desperate to buy. They often overpay, and they are more likely to overlook defects that they would shun in a sour market.

Resale value has become a bigger issue since the housing recession began five years ago. Buyers are more cautious in their home-buying decisions. They don’t want to buy just any home; they don’t want to make a mistake and end up wanting to move in a slow market in which they might lose money.

The homes that hold their resale value well are the ones that appeal to a broad cross section of buyers; offer a good floor plan that works for different lifestyles; have a good amount of space but are not enormous and expensive to maintain; and exhibit a pride of ownership. They should also be in good condition.

Location is also a critical element of resale value. There are market niches that are always in demand, in both hot and soft markets. For example houses in neighborhoods with close proximity to shops, cafés and public transportation systems.

That’s not to say that every listing in these neighborhoods sell quickly. To sell, it needs to be priced right for the market.

Six signs a home will hold its resale valueIt’s easier to recognize a home with good resale value in the current market than it was in the bubble market of 2005 and 2006 when virtually all homes sold in many areas. In a soft market, the homes that sell within 30 to 60 days are either good homes or good deals.

Ideally, you want to buy a home that has good resale value. Not one that’s just a good deal. There’s no urgency to buy now in many areas, although it would be nice to take advantage of record-low interest rates. But you shouldn’t buy a home that won’t work for you long term just to lock in a great interest rate.

Even though there are a lot of homes for sale on the market, in many areas there is a not a surplus of quality inventory on the market. One reason for the lack of quality homes on the market is that many sellers are waiting for a better time to sell. Another reason is that homes with good resale value don’t tend to change hands that often.

THE CLOSING: There may be good news ahead. Leslie Appleton-Young, chief economist for the CALIFORNIA ASSOCIATION OF REALTORS®, predicts that sellers who have been waiting for a better time to sell may decide they’ve waited long enough and list their homes for sale in 2012.

Dian Hymer is a real estate broker with more than 30 years’ experience and is a nationally syndicated real estate columnist and author.

Examine Features Now To Sell for a Good Price Later

Home for saleWhen you buy a home, chances are high that you will eventually sell as your life changes over time. In the United States, it’s estimated that homeowners change residences every five to seven years.

So when you are house hunting, it’s important to keep resale value in mind. Some features you may find desirable may not appeal to others when the time comes to put the house on the market. That would hurt both your ability to sell the house and to get a good price.

As you start your search, consider these factors that will affect resale value:

Exterior Features

Location: If you find the property that offers most of the features you are looking for and it’s going for a bargain price, don’t rush into it. There may be a reason the house is selling for a bargain, so carefully consider where the property is located. When you resell, for example, couples with small children are likely to be searching for quiet streets, large yards and proximity to shopping and schools. Rectangular lots generally sell better than oddly shaped or awkwardly situated properties. For many buyers, the determining factor is the neighborhood.  A home in a safe area will always fetch a better price than the same sized home in or near a less desirable neighborhood. In addition to a low crime rate, many buyers are also looking for a high-achieving school system.

Maintenance: A beautifully manicured lawn with landscaping may have curb appeal, but it is likely to be expensive and time consuming to keep up. You may be willing to pay a premium for it but the next buyer may not. A house with little to moderate landscaping generally has the best resale value. More buyers will also choose a home with exteriors, decks or patios that are made of low-maintenance materials.

Swimming pools: Pools can pose resale problems. Safety concerns means families with small children generally avoid them, as do buyers in regions where a pool is used only a few months of the year. Buyers will also be aware of the maintenance pools require. Keep in mind, however, in some upscale neighborhoods a pool is almost considered an essential.

Size: Resale value is also affected by the size of surrounding homes. Don’t buy the largest home in the area — a large house in the midst of smaller houses generally will sell for a lower price than if it is surrounded by homes of a similar size. Conversely, small or medium-size homes near a larger dwelling tend to increase in value.

Interior Features

Bedrooms/bathrooms: Homes with at least three bedrooms usually have good resale value. The price goes up if the master bedroom has its own bathroom. In any case, the home should have at least two bathrooms and they should be updated for resale purposes.
Kitchens: The center of many homes is the kitchen, which makes it the most important room in the house. Look for modern appliances, a large pantry, plenty of cabinets, attractive and spacious counter tops and adequate dining space. If there is a family room or dining room, the kitchen should be nearby.

Storage and space: In general, lots of closets and well-organized storage space will entice buyers, as will plenty of natural light. Walk-in closets add to the appeal, and garages boost resale value, particularly if they fit two cars. A separate laundry room is typically a great resale feature.

Character: One all-important aspect that will help sell a home is its character. A home’s distinctiveness, however subtle, can charm a buyer. Small touches such as granite counter-tops, French doors, an antique fireplace, or a picturesque view through a bay window can often cinch the deal. The more character your home has, the higher the resale value.

When buying a home, it all comes down to this: Purchase a house that suits your immediate needs and desires, but keep an eye on its resale value. You’ll reap the rewards when it’s time to move on.

This article is by BizActions.