7 Things That Drive Up the Cost of Homes in Your Area
If you own a home, you know that housing prices can fluctuate widely over time. Whether you scored a deal when the market was low, or you bit the bullet and bought high, you hope for a nice healthy jump in home value before you sell. But what causes housing prices to increase? According to Johnny Mansilla, a licensed real estate broker at global real estate firm, Nest Seekers International, home prices are affected by both internal and external factors. Internal refers to what updates you and your neighbors are doing to your homes, and external, means everything in the near vicinity. Here are some of the prime external factors that could drive up real estate values in your neighborhood.
Walkability
Neighborhoods that offer a lot within walking distance are worth more to potential buyers, according to Constantine Valhouli, Director of Research for NeighborhoodX, a real estate research and analytics firm. Of particular importance are peaceful and safe side streets and interesting things to see and do, so improvements in those areas can positively affect pricing.
And can you walk to your job? “Having the option to walk or bike to work (and avoid sitting in traffic for an hour or more each way) often translates into higher real estate prices,” he said.
Public transit
Cities like Denver and Seattle are improving their transit systems. These updates will make these cities more appealing to potential buyers, but only if the systems are reliable and have convenient schedules and locations. Valhouli notes that on the flip side, some elevated (above-ground) trains can reduce value for the properties near the tracks, due to the noise.
Shopping
Proximity to grocery stores and shopping areas can help improve residential property values nearby, especially if what’s on offer is of high quality. Nick Bailey, president and CEO of Century 21, said that “destinations for customer experiences, ‘hip’ coffee shops, and businesses with a significant number of Yelp reviews” offer the most value.
Nightlife
Have a few new pubs, clubs or restaurants opened nearby? A neighborhood can be more attractive to prospective buyers if they can enjoy a nightlife close to home (unless it’s too loud).
Parks & Playgrounds
Updates to nearby outdoor spaces can improve the overall perception of a neighborhood. Because couples with kids will flock to a neighborhood with attractive outdoor spaces, property values can increase.
Improvements in School Rankings
In addition to looking for parks and playgrounds, couples with kids often look for high-ranked areas to raise their kids, so if area schools rise in the state rankings, properties in the area can increase in value.
Re-zoning
If an area is rezoned, it can increase the value for the properties there if potential buildable space increases. Valhouli said, “Let’s assume a 2,000 square foot house is in an area that allows houses to be up to 3,000 square feet. This additional 1,000 square feet of expansion has value, so it increases the asking price of that property.”
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