5 Unexpected Factors that Impact Long Term Home Value
After investing in a new property, the assumption is that it will grow in value. After all, you’ve spent several weeks or even months researching home values, evaluating the suburb and surrounding areas, and doing your due diligence to ensure this is a smart investment. It should remain one after purchase.
But there are some unexpected factors that can have a long term impact on your home value. Some of these are good and some of them can be costly. Here are five that you should be aware of and look for warning signs of before investing.
Issues with Neighbours
It’s not always easy to tell in advance what type of people you will be living next to when you buy a home. The sellers are unlikely to hurt their case by admitting to problems with the neighbourhood, but you can do some research here.
You can check to see if there have been excessive complaints about noise or criminal complaints in the area. You can also interview neighbours as you visit and inspect the area before agreeing to a purchase.
Unapproved Home Improvements
Many home improvements require a permit or form of approval from your local government. If these permits are acquired, it can hurt the cost of the home when the time comes to sell. Future buyers may be hesitant to take on the responsibility of a home with improvements that could result in fines.
If you make improvements, be sure to follow the proper channels and acquire all needed paperwork in advance.
Nearby Construction or Installations
While the likelihood of major construction in a Sydney suburb that would disrupt your view or cause excessive noise is small, it’s always good to check in advance whether changes will be made in the suburb after your purchase.
While new plans can certainly develop in the future, if anything is in the planning or pre-planning stage, you should be able to find out now. On any future plans, you’ll have more notice and the ability to make your voice heard.
Accessibility and Proximity to Nearby Amenities
This is another factor that is unlikely to change substantially in the near future, but additions of new amenities or transportation options can often improve home values if they are not too close to your property. At the same time, local amenities closing without replacement can have a negative impact.
Quality of the Local Schools and Police Force
This is a factor that can have a big negative impact on home values if a problem develops. Declining school quality or increased crime will almost always result in a drop in property values. Again, this is a factor that takes a long time to have an impact as such changes don’t occur overnight. Nonetheless, if there are warning signs, be sure to evaluate them thoroughly.
Any one of these factors can change over the course of several years or decades. That’s not to say you should let a fear of future construction or unruly neighbours paralyse you when the time comes to buy, but you should also do your research as much as possible in advance to avoid known issues as much as possible.