What is a “Good Resale Value” Home?

18 05 2010

Home Buying Techniques

When you’re thinking of buying your first home, or any home for that matter, where do you start? Do you consider the resale value of the home if you decide to move? Do you consider whether the value of the house will grow or how quickly it will sell? Perhaps you should! Equity planning?

Most people buying their first house wouldn’t live in the same house for the rest of their lives. So when you start to analyze home resale values before you buy your first property, there are a few things to consider. Taking the extra time to do a little more research can put a little more money in the bank. Especially when it sells quickly and builds more equity in your property.

Here are some things you can do to maximize your investment:

Location, Location, Location

A good location now doesn’t necessarily mean that it will be a good location when you sell. Understanding of demographics and urban trends with great timing can increase your equity substantially.

  • What makes a neighbourhood desirable? What are recent trends that people desire in the neighbourhoods?
  • What other areas are increasing in desirability?
  • Is there new development shifting towards a certain area? Is there sufficient services in the area (groceries, shops, schools, hospital, etc.)?
  • Is there zoning changes with residential areas shifting over to commercial properties? Or vice versa in situations when intensification is occuring or the attempt to limit urban sprawl? This can have either a positive or a negative affect to your property value.

Tip: You should always choose a home that suits your needs, but if you can find one in a location that others seem to want, BONUS!

Your Target Market

What are the demographics in your city? Are they generally senior citizens or are they younger families with children or young professionals? Resale value potential for a senior citizen might be a one level home or for a younger family with children may be a house with lots of bedrooms a big yard on a quiet street, and young professionals may prefer a condo in a trendy area and near transit. So depending on your area, what are the demographics of potential buyers?

Tip: Look through local real estate ads. Keep an eye out for reoccuring themes or features that are consistently mentioned in ads.

Avoid Old Features

  • Homes with at least two baths sell a lot faster and for a lot more than houses with only one bath.
  • Central forced air heating systems are more desirable than electric baseboard and ceiling heaters.
  • Washroom decor in outdated colors, or stained from years of improper cleaning, will be hard to fix.
  • Popcorn ceilings are outdated

Tip: Fix and Flip: Outdated features have a negative affect to resale value, but you can use that to your advantage if you buy a home under market value and make the essential updates. You must analyze the update costs and determine how much value the upgrades will add to your property and whether you can sell it again at a profit.

Cosemetics Makeover

  • A paint job is a quick and fairly inexpensive fix which will give your home a new look, inside and out.
  • Applianceize – New appliances and/or cabinetry can make your kitchen look brand new.
  • Changing a few kitchen cabinets with glass doors and adding lights inside the cabinets gives them a new look with soft appeal.
  • Painting kitchen cabinets isn’t difficult and it’s a thrifty way to change the entire feel of your kitchen.
  • Skylights brighten up a dark home.
  • New light fixtures lighten up rooms and new switch plates can enhance any room’s appeal.

Tip: As simple as it may seem, a little make-up is all a home needs to make it beautiful. Homes in need of cosmetic updates are often priced under market value and a great opportunity for you to build great resale value.

Target Markets Needs

  • Closets, storage, shelf space, walk-in closets are often deal breakers
  • Homes with lots of natural lighting are always desirable.
  • Bedrooms on each end of the home give increased privacy and is increasingly popular with buyers.

Tip: Popular features differ with different demographics and regions. Find out which features buyers want!

That’s a Wrap!

First of all, you want to buy a home that fits your needs, secondly, consider its resale value before you make the final decision. A smart purchase now will help give you the extra equity required to move on up.

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