: Factors that Affect Home Values
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(437 Words)
Home values are fluid. There are many factors that influence them, and as these factors change, so can the price of the homes, sometimes significantly. The following are some of these factors.
Economy
As the economy has turned in the past few years, home values in many areas have plummeted. Many people are losing their jobs and can no longer afford their homes. They may have bought homes, which they could not afford in the first place and secured loans that in hindsight never should have been approved. Many people are in foreclosure or being forced to sell their homes to tremendous losses. With all of these homes being offered at lower prices, many people are just not seeing the amount of money they would have seen before. On top of all of this, with so many people selling a lot of people simply do not have the money to buy right now. After years of giving away ridiculous and irresponsible loans to people, now banks are holding on to their funds with an iron fist and many are being turned down for mortgages. Many people who had invested before are no longer flipping homes and the general feeling is that a lot of homes were valued at way too high in the past and are now settling lower.
Location
A home’s value will also be influenced by its location. If you are in a nice area within easy driving distance to a major metropolitan area such as New York City or Atlanta then your home might be worth more. As you travel further away from these hubs of jobs, oftentimes the prices fall. For instance, if you work in Washington D.C. you will generally pay less for a home in the further Frederick, Maryland, compared to Germantown, Maryland, and then compared to Rockville, Maryland. Also, you might be close to something else that is of value such as the beach in Miami.
You also need to consider the quality of the area. If you are in a “bad area” with a high crime rate, then the values are likely to be lower. If you are in a very nice area and the houses all look well cared for, then it might be more.
There are many other factors that influence the value of a home. Of course how large and what features it has matter. In general a new or at least newer home commands more. The appliances and quality of the fixed items inside also play a part. You can look to www.zillow.com as a resource to help you find the value of a home.
Updated On: 08/17/2010 Published On: 08/17/2010 Article ViewerClose
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