Property value is a strange thing to understand and for many might seem almost random in its valuing. You might think that the type of building and location are the defining factors, and much of the time that can be true, but there are other far more subtle things that can affect a property that may not be obvious.
Location, location, location
The location is a complicated thing to pin down with property. That may sound like an odd statement, but properties that are on the borders between districts for example, are prone to conflicts over which they belong to; especially if one is more affluent and desirable than the other. Add to this that proximity to all manner of things, such as a natural water course, can cause insurance to rise significantly; as such the property value will take a hit as people aren’t prepared to pay the same as other properties without the higher insurance. Similarly, the first instinct people have is that living by the sea is highly desirable and therefore expensive, but if a property has a penchant for flooding in bad weather, then it may well carry a lower price tag.
History
The history of a property can have a dramatic effect on its value, and it is also something that sellers can easily overlook mentioning. There are all manner of different things that could lead to problems with a buildings history; crime is a big one along with maintenance and other local factors. One great example of this (which may or may not have happened to this writer) was an agent offering to show a five bed detached property in a reasonable area that was on the market for less than a two bed flat. When questioned about it, the response was that it required some work, but that still would not have explained the ridiculously low price. When pressed further, the agent eventually conceded that there has been a problem with youth crime in that particular area and the property had been set on fire five times that year already. It was March. Needless to say, history matters.
Don’t rely on one source
Sellers and agents will usually act with a decent moral compass, but you don’t want to entrust your financial security that easily. If you are looking to buy in Sydney, then check what other agents think in Sydney. If you want to buy in Brisbane, ask the opinion of mortgage brokers in Brisbane. Use surveyors you find yourself not those who are provided by agents to ensure they give an unbiased account. It is also worth visiting a property at various times of day and night, just to drive past or around the area to check on the way things are at different times. Hopefully this will allow you to notice any social problems before they become your issues.
Wherever you choose to buy, just take the time and be careful. Mortgages are a lot of money so make sure you cover all your bases before going ahead.
