Assessing a home’s market value
How do you know if a home sale price truly reflects the property’s market value? If you want to pay a fair price, you’re best off informing yourself of the value of the home you are planning to buy.
What influences a property’s sale price?
Supply and demand are largely what influence a property’s value.
A property’s characteristics (location, surface space, property type, etc.) will also influence its perceived value in buyers’ eyes. In addition, the more demand for a product, the higher the price.
Factors such as market trends and the economy will also affect demand. Market tendencies like favourable interest rates will greatly increase a property’s perceived fair price. Conversely, an economic slowdown or a rate increase can cool buyers’ interest.
How the homeowner chooses to sell his or her property (either with a real estate agent or without) does not influence the property’s market value.
Key factors that influence the value of a home
- Property type
- Living area
- Age (year of construction, maintenance schedule, renovations)
- Lot size
- Materials used
- Economic conditions
- Supply and demand
- Presence of a garage, an in-ground pool, a fireplace, a finished basement, etc.
How to know if it’s a fair price?
To determine whether a property’s asking price seems reasonable, the buyer can measure it against other comparable properties that have sold in the area.
For example, if all the townhouses recently sold in a neighbourhood went for between $210,000 and $235,000, the buyer can expect to pay a price within this bracket.
For more information and to obtain a fair and objective market evaluation, you can consult a professional real estate appraiser.
Did you know?
About 8 out of 10 Quebecers surveyed believe that the seller is the best person to inform them of the benefits of living in the property.**Source: Results from an online Extract Marketing Research survey, conducted among 1170 Canadian homeowners (Quebec, Ontario and Alberta) aged 25 to 64, from April 23rd to May 12th, 2014.