If you had $1,000,000, what would you do with it? Would you buy a house? If so, where would you buy?
Depending on where you are looking, one million dollars could buy you the dream home you have always wanted or a small 1 bedroom home. Areas like San Francisco or Boston have extremely expensive Real Estate Markets, where this amount of money would just get you started, but for other locations, you could own the mansion you’ve dreamed about. The Wilmington Real Estate Market has been strong for many years, however homes for a million dollars and up are still exclusive and luxurious. So you might ask yourself, what affects the value of a home? Why can I purchase a mansion for 1 million dollars in Wilmington, NC, but only get a small 1 bedroom home in San Francisco? Let’s break down the main factors that affect a home’s value.
- Location: One of the most influential factors in value. Most of the time, homes that are in popular/dense cities, waterfront/beachfront, or located in historical areas, will generally have a higher asking price.
- Land: When you buy a home, you are not only buying the home but also the land it sits on. A general rule of thumb is that the property itself usually makes up about a fourth of the total value of a particular home. In essence, if you buy a home for $1,000,000, then the value of the land should be around $250,000.
- Size: There is a definite relation between the size of a home and the value. Typically you will see two different sizes, the living area and the total area. The living area is considering the interior of the home that is heated. The total area is the total square footage of the home, which includes a garage or porch or portion of the property that isn’t considering living area.
- Age: This factor can affect the value both directly and indirectly. An older home doesn’t necessarily mean that the home isn’t worth as much. Many homes are actually purchased specifically because of their age.
- Home features: Believe it or not, but the layout and design of a home’s kitchen plays a key role in the desirability of a home. In most million-dollar properties, you will see high-end appliances with custom cabinetry and granite counters. However, other features like a large master suite with a custom bathroom create attraction.
This is only a shortened list of the factors that affect home value, but if you would like to know more about valuation or Wilmington’s Real Estate Market, give us a call today at (910) 367-2965!