What Affects the Prices of Homes for Sale?

family going to see homes for saleThe prospect of becoming a homeowner is an exciting time for anyone. Whether you are a first time single or attached new buyer, or looking to upgrade your current home, shopping for a new home is exciting, scary, and daunting. Everyone approaches how they shop for a home differently. Some people choose to strike out on their own, finding homes for sale on their terms and preferring to do their own negotiations. Others rely on real estate agencies like ARP Rental Homes to help them narrow down their options and selections. Still others prefer to involve not only real estate agents, but their banker, their architect, their plumber, and anyone else who can provide input on their new home. However you decide to go about finding your new home, one thing that can make a huge difference is familiarizing yourself with how homes for sale are priced. What affects these prices? This can make a huge difference in how you approach your options in terms of your preferences, your needs, and your budget.

Common Factors That Affect Real Estate Prices

We often think that a house’s size is the most important factor that affects a house’s price. However, real estate is a complex industry that is affected by much more than square footage. Both the house itself and other, outside influences come together to make up the equation that will end up determining the price of a home. Here are the top influencers for real estate prices:

Location, Location, Location

This is one obvious and often used phrase that is actually very true when it comes to the pricing of homes for sale. Research has shown that there are three top things people are usually looking at when shopping for a new home:

  • Proximity to good, quality schools (this is actually THE top reason for people who have kids or are planning to have a family)
  • Proximity to your employment or area of high prospective employment
  • Proximity to social recreation and shopping

In other words, the closer they are to these three things, the higher the price of a home is likely to be.

House Upgrades/Updates

The house itself will obviously be a huge factor in deciding a price, but not in the ways you may think. Square footage can mean very little if the house is in need of serious updating or a real fixer upper. A big home that needs a lot of work, or is seriously dated can be priced much lower than a smaller home that has a modern, updated look. Appliances, flooring, windows, HVAC- all of these things can affect the price of a home.

Inspections

When the market is competitive, it can be tempting to forgo an inspection report and buy a house as-is. This is especially true if the house looks clean, maintained, and modern. This is never a good idea. There are many things a good coat of paint and a few upgrades can hide. Carpet can hide rotting floors, the roof may be on its last legs, the electrical wiring can be ancient- there are countless things that can be wrong with a home that can easily be missed during a superficial review. An inspection can reveal things that can give a buyer bargaining power. The house’s price can dramatically change if a seller decides they don’t want to fix the issues.

Comparable Properties

There is a reason why homeowners get frustrated with sloppy neighbors. The state of surrounding homes can have a huge effect on a house’s value. A home in a well kept neighborhood with upgraded homes that have sold at high values can actually be valued higher, even without certain upgrades due to the comparable prices of the homes around them. In contrast, a well kept home with upgrades that is in a neighborhood where the majority of homes are not maintained and look sloppy may end up being priced lower than the appraised value due to their neighbors.

We Can Help You Look for Homes for Sale in El Paso

ARP Rental Homes has a great variety of listings of homes in El Paso. Our listings are located in different areas, and are priced for every budget. Let us help you find your next home- contact us today!

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Contact ARP Rental Homes

If you would like more information on any of our homes, or would like information on managing your property, please call us at (915) 591-4636 or contact us via our website. We will respond to your request as soon as possible.