How do you determine a property’s value?

To determine property value quickly, you will need to prepare the whole procedure in a short time. In this article, we advise you on how to do this.

Photo by Jcomp – Freepik

To meet the intended values, a correct valuation of your property will help define the final value. One of the aspects that most contributes to a correct valuation, is, without a doubt, the analysis of the location of the property. The next aspects to consider for a fair valuation of the property are the square meters of the property area and how well maintained the property is. Other characteristics that will influence its value and will help sell quickly are small details, like heating and cooling systems (air-conditioning and central heating), the existence of a lift (if the property is inserted in a building), a private parking space or garage, storage rooms and exterior spaces. Since the last lockdown, due to the pandemic, outdoor areas have gained a new appreciation when selling houses.

In all economic sectors, it is recognised that values are influenced by the law of supply and demand. In the real estate sector, it is no different, so if demand for a certain area of the city is high, property prices will rise. In these cases, it is determinant that the real estate agent has a deep knowledge of the performance areas to help you obtain a notion of the final value. There are many online platforms for automated assessment that can be used by anyone. Although this assessment is very superficial, these platforms are a good initial indicator of the final value. The knowledge of a real estate agent will give you a more realistic notion and you may get a surprise if your house meets some aspects that the automated platforms will not question.

• What should you know before selling a property?

  There is a formula that addresses some of the issues already mentioned above. It is not exact, as it depends on other factors associated with the act of selling the property, but some variables are important for the final decision.

1. Location: the more relevant characteristics are the proximity of amenities, such as schools, public transport, supermarkets or even the car parking next to the property.
2. The year of construction: it is almost inevitable to think that the older the property is, the less value it will have. Barring exceptions where the state of conservation is excellent or if it has been recently renovated.
3. The number of rooms and area: it is implicit that the house typology will influence the value, but what if I told you that a one-bedroom house may exceed the value of a two-bedroom house? The area of each room will matter and if the one-bedroom is bigger, it could easily have more rooms than it initially had.
4. The orientation of the property: it is one of the most important factors when the potential buyer visits the house. A good sun exposure, preferably with an east to west orientation, adds a lot of value to the property.
5. Finishings and others: the property interior finishings will help form the value more clearly. The materials used, the available equipment or even the balconies, terraces, pools and the view, will also influence the final value.
6. Taxes and other expenses: when formulating the value of the property always count on taxes and legal expenses included in the sale of the property. In the calculation, you should always keep this factor in mind, if you do not want to get a surprise later. There are many simulators on the internet for you to access these numbers. (calculate in this simulator the capital gain of the property).

• How long does it take to sell a property?

  Getting to the value you want will depend a lot on the time you have available. The sooner you want to finalise the deal, the lower the value of the property has to be. If you have time and work together with a real estate agent, you will find that the result of the sale will meet your wishes. By working with a professional, you will save time and money, and the commission paid to them is fully deductible in the capital gains that you declare in the tax return (IRS). What may delay the sale of a property is the back and forth when the buyer applies for a bank loan. In this case, the buyer's bank makes the valuation of the property and it will have to coincide with the value requested by the owner.

• How to increase home value?

  Improvements or renovations may be the way to go, but it will all depend on how much it costs to make the house more appealing and whether it adds value. You should first ask for some budgets and assess whether this is a viable option. What we can see in the current market is that most second-hand houses are already refurbished, and this is one of the factors that accelerates the sale of the property. In some cases, it is not necessary to make deep works to the property. Small interventions, such as painting the walls or laying floating floors, make the sale go much faster.

• What can make a house sale fall through?

  Essentially it is the value that the owner determines for the sale of the property. It is paramount to get it right the first time at the right price! If the owner puts the value too low, the buyer may think there is some problem associated with buying the property. If it is too high, it may take twice as long to close the deal.

One of the best steps to take when selling a property is to work together with someone familiar with these real estate topics. You will save time, money and half of the bureaucracy will not be handled by you. Find in Casas do Barlavento your best ally to sell your house.