Copyright (c) 2011 Robert Gray
With moving house commonly known to be one of the most expensive (and often one of the most stressful!) events in a person’s lifetime it is important to ensure that you plan your finances carefully and make sure you are aware of all the costs of moving house, which can be substantial. One important thing to consider is how much your current property is worth as this is likely have an impact on how much you will be able to purchase a new property for. This article looks at five factors to be aware of that could affect the value of your property.
1) The state of the economy and the housing market in general.
House prices fluctuate depending on factors such as low affordability (i.e. people earning a low salary compared to either actual or perceived (compared to salary) high property prices), the economic recession (namely the credit crunch) and rising unemployment, and the fact that people are reluctant to buy or sell a property when house prices are falling.
We have all heard of the phrase ‘location, location, location’ and this refers to the importance people place on the location of the property they are seeking to buy. The value of your property may be greater than that of similar properties, in just as good condition but in a less sought after location, if your property has good transport links and is well placed for commuting, is in a sought after area, and – increasingly importantly – is in a ‘good’ school catchment area. We now live in a generation of people who are prepared to – and do on a regular basis – move to a specified catchment area in order to get their children into their preferred choice of school.
3) Condition of your property.
It is common sense that if your property is in a less desirable state than the property next door that is also for sale (which, let’s say, has a brand new fitted kitchen, a sparkling new bathroom, and new carpets throughout) then your property is likely to be placed on the market for a lower price than the house next door. Similarly, if people viewing your property are aware that if they purchased your property they would need to immediately gut the kitchen, install gas central heating and replace the avocado bathroom suite they may be willing to pay a lot less for your property than a property – even perhaps a slightly smaller property – that needs very little work doing to it.
4) Age of the property.
Some older properties may have historical relevance or quirky characteristics which add to the value of the property. Conversely, quite often older properties are more expensive to upkeep and may need more renovations than a newer property, which could all be reflected in the value of the property.
5) Extensions and improvements.
Generally speaking, extensions such as garage and loft conversions do add value to a property as long as they have been carried out to a high standard and have increased the living space in the house.
It is important, therefore, to have your property valued (by at least three different agents) before making the decision to move house. If you are still basing your budget on the value of your house when you bought it several years ago then you may be in for a surprise – one way or the other!
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