Oakville Real Estate News

13 Invisible Real Estate Defects

Blog by Joette Fielding | March 17th, 2015

13 Invisible Defects In A Home.jpgWhether you are buying or selling a home, it is imperative you understand what influences price in the marketplace.  It is very important for you to understand the effect the invisible defects have on the value of that particular home.

Years of observations and experience have demonstrated that these are real issues in the minds of a significant segment of buyers coming into the marketplace. In my opinion, most all property, regardless of its limitations, can be a good value if it is priced accordingly.  Below is a list of what I have defined as “defects” or conditions that will influence the price a buyer will pay for a house in any marketplace.  This list describes some of the issues to look for when buying or selling a house.  While these are the major factors, there may be other issues that can affect the sale or purchase price of a particular house.

1. Future of the Area – Are home values increasing or decreasing in the general vicinity? If values are increasing, you may have more resale potential. Just be sure the neighbourhood information you receive is accurate and current.

2. Local School System – Although you may not have school age children, investigate the schools in the neighbourhood before evaluating a home’s value.  The school’s reputation may affect demand for your home in the future.

3. Economic/Other Factors – Local or neighbourhood economic factors, like increased property taxes, labour strikes, plant layoffs, etc. can affect a home’s value.

4. New Subdivision – Before buying a home in a new sub­division, ask the developer to see specific plans for the development of the remaining lots.  Keep in mind developers sometimes have external factors that force them to sell, change, or abandon plans for the subdivision’s development.  Are there restrictive covenants?  If so, are they recorded at the courthouse? Always obtain and keep a copy of them.

5. Vacant Land and Oversize Lots – Vacant land always presents the risk of the unknown. Find out who owns the adjacent vacant property and what their plans are for it.  Remember, regardless of the owner’s intent that intent and zoning can change with time and circumstances.  Homes with lots in excess of the typical lot size in an area can affect the value.

6. Adjacent Property Features – The property next to, behind and across from a home may have a bearing on its future sale potential. Ask yourself if the price is consistent with neighbourhood variables like condition, size, zoning compatibility, junk in the yard, etc.

7. Floor Plans and Amenities – Consider the layout and size of rooms when evaluating a home. Does a two-bedroom home fit into an area of mostly three-bedroom homes? A home with a bedroom that can only be entered through another bedroom should be evaluated differently.  Houses lacking a garage in an area where garages are common should be of concern. Unusual floor plans and oversized rooms may not work efficiently for some families. Further, missing amenities, such as no half bath in high traffic areas when most other homes in the area have them, can sometimes affect marketability.

8. Over Investing – Owning the most expensive home in a neighbourhood is not necessarily the best move because the surrounding homes may not be able to support an above-average price range. Homes with luxurious and extravagant decor or amenities, or homes that are larger than the other homes may limit the value of the investment.

9. Flooding – Be aware that property on a lake, river or in a flood plain zone may be susceptible to flooding and problems such as re-occurrences of water damage, inconvenience, and danger, all of which can limit marketability.

10. Additions – Older homes with new additions or remodeling may not cause concern but should encourage questions and research about the project, with regard to floor plans and over investing.  Incomplete construction or incomplete remodeling can affect the value of a property and should be considered when making a purchasing decision.

11. Poor Construction and/or Condition – Keep in mind that cleanliness, upkeep, and outward appearance all affects the value of a home. Check the quality of building materials and workmanship like mitre joints, door frames, mop boards, consistency in plastering, woodwork, and painting. Also, check major parts like the roof, off-brand HVAC systems, support beams and basement leakage. Also look everywhere for evidence of previous major water damage.

12. Extended Market Exposure – Be aware and take into consideration the length of time the home has been for sale. Why are people not looking at it? Or if they are, what is keeping them from buying it?  Is it just price? When you suspect a home has been on the market a long time, ask the agent for a copy of the property’s listing history for the past five years. A neighbour can also be a good source for information.

13. Negative Environmental Concerns and Hazards – Groundwater contamination, leaking underground storage tanks, asbestos, urea-formaldehyde foam, radon gas, waste disposal sites and even busy streets are generally a matter of known information in neighbourhoods.  Ask your representative for help in determining the degree of concern and where you can find more information on the subject.

Content courtesy of http://www.realtor.com


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