As the old real estate adage goes, when it comes to selling property, it’s all about “Location, location, location.” Even if you go to great lengths to make your home as appealing to buyers as possible, the area your home is in could reduce your home’s value—an effect known as external obsolescence.
While there’s not much you can do about your neighborhood, it still helps to know how factors involving your location affect your home value, which will help you plan your selling strategy accordingly. Keep reading to learn more.
Neighborhood Curb Appeal
While you could do everything to stage your home and boost its curb appeal, if the rest of your neighbors aren’t doing the same, potential buyers will likely haggle for a price lower than what you’re asking for. Neighboring homes with neglected lawns or have trash sitting by the curb or driveway can easily drive down your home’s value, as it sends the message that the people living in the neighborhood don’t care about it.
Price of Neighboring Homes
The price of homes that were recently sold in your neighborhood will also have an effect on your home value. If potential buyers know that the going price for a four-bedroom and two-bath house in your neighborhood is $200,000, and the price you’re asking for your home is $299,000, they’re going to wonder what makes your home so expensive. And unless you have something special that really justifies your asking price, buyers will likely balk at having to pay for a home that’s more expensive than surrounding properties.
Schools
The quality of neighboring schools will be an important factor for potential buyers with children. If your home is in a town with a great prep or high school, the demand for homes will likely be higher, which in turn means you can demand a higher selling price. Conversely, if you have struggling schools nearby or no schools at all, your home’s value is likely to be lower.
Jobs
Likewise, a home in an area with several job opportunities will be more valuable than a home in an area with high unemployment. This explains why homes in university towns tend to be more expensive—the steady stream of students entering the campus guarantees a similar stream of customers for businesses. If you have research centers, universities, or the headquarters of a Fortune 500 company nearby, you can get away with a higher selling price for your home.
Crime Rate
This one is a no-brainer. If your home is in a part of town with a high crime rate, finding potential buyers will almost always be a struggle, especially if the crimes involve burglary and homicides. But if the neighborhood is slowly being gentrified, you can point this out to buyers to justify your home’s value.
If neighborhood factors are making it too difficult to sell your home at your desired price, sell it to an investor like Blue Hen Homebuyers instead. We buy all kinds of homes, no matter their condition or what part of town they’re in. Call us at 910-802-2222 to learn more about our services.