Buying a home is a big deal, whether it’s your first home or whether you’ve gone through the process before. And when done right, buying a home can help you build life changing wealth for your family.
When you take resale value into consideration up front, you can make wise and strategic decisions when it comes to purchasing a home to ensure that it not only meets your lifestyle and family needs, but that it also helps you build equity and wealth in the coming years.
In this article we’ll share with you why it’s so important for buyers to think about the resale value of a home up front, things to think about so you can maximize the eventual equity you build in your home, and how to leverage real estate to help you build wealth for the long term.
Why Resale Value Matters When Purchasing Your Home?
In previous generations, it was common to make a home purchase only once in a lifetime; people tended to purchase “forever home.” They envisioned raising kids in that home, growing old in that home, and passing that home on to future generations.
However, just as so many things in our lives have changed dramatically, so have our habilitation practices. Most of us don’t stay in our house for the full duration of our lives as did many people in previous generations.
Our modern dynamic lifestyle and economy call for flexibility, mobility, and frequent changes. Many people are following their jobs and careers even if it means moving from one side of the country to the other.
Further, as families grow and needs change, many people choose to upgrade or downsize their homes at different times of their lives.
Thus when purchasing a home these days, especially in an ultra competitive market like Bluffton and Hilton Head Island, it’s important to weigh your own personal preferences together with the resale value of the home down the line. That way, you can ensure you reach your financial and wealth goals when you sell the home in the future.
Buying a home with good resale value might take a bit more work and open mindedness on your part, but you’ll be grateful for the payback later when it sells quickly, helps you upgrade to your next home, and helps you build long term wealth for your family.
Location, Location, Location
You’ve heard it before: the three most important factors in real estate are location, location, and location!
Indeed, location should be the first thing to consider when looking for a home. So, what makes a good location?
Start by considering some general elements that go into a great location:
- Amenities – Does the neighborhood have appealing amenities? Does it have easy and fast access to good schools, restaurants, and shops?
- Accessibility – How easy is the commute? Is there public transportation available?
- Crime and Safety – What are the crime stats in that neighborhood? Do you feel safe in the neighborhood at night?
- Walkability – How walkable is the area? Are there people out and about walking, jogging, and biking?
- Noise Level – What’s the general noise level? Is the neighborhood more residential, or are their busy streets nearby?
What To Look For In Potential Homes To Maximize Resale Value?
Once you’ve settled on a target neighborhood or two, it’s time to look at specific homes. Even within a single neighborhood the home value can vary widely, based on a number of specific factors.
That’s why it is important to know what to look for upfront, so that when you tour a potential home, you know exactly what to look for to ensure you’re buying a home with maximum resale value.
External Factors of the Home
How close together are the houses in that neighborhood? The density of homes can often play into the overall value of a home. Generally, the more space between homes the better.
Where on the street is the house? A house located at the end of the street will suffer less noise from neighbors and their guests. If the street is a dead end it’s even better. A corner house may have more light and air, but might have a less desirable yard.
What direction does the house face? This can play into the light inside the home, how much sun the yard and garden get, and more.
What’s the size of the lot and how close or far is the house to the street? Some lots in the same neighborhood can be much smaller or larger than others. Generally, larger lots with homes set farther back will have greater resale value. In neighborhoods with many young families and children, homes with large yards that are far from busy streets tend to be more desirable.
Is there ability to expand? Consider whether the lot will allow for future expansion of the home
Internal Factors of the Home
In addition to the external considerations above, there are many important internal elements that can make a house quality higher and increase the resale value for potential buyers down the road. Here are some things to look for inside the home to ensure maximum resale value.
What’s the shape and square footage of the house itself? When touring the home take into consideration the size and shape of the home. Are there any awkward layout issues? How does the square footage compare to other homes in the area.
Look for lots of closets and with as much additional space as possible.
Homes with lots of natural lighting are very popular. Look for large windows and try to tour the home at different times during the day.
Look for plenty of bedrooms and bathrooms. In general homes with 3+bedrooms tend to be highly desirable.
Is the kitchen large and convenient with lots cabinets and cooking spaces?
With more and more people working from home, is there a suitable room or area that can serve as a home office?
Is there a full laundry room? Or a laundry space? Washers and dryers located inside the home tend to be better than those located outside (i.e. in the garage).
What about the general layout? Buyers tend to prefer homes that are open concept, with a more versatile layout. Does the home you’re considering have a flowing and open design?
Now, more than ever, outdoor spaces are very important. Homes with larger yards and usable outdoor space are, in most cases, more desirable. Does the home have a patio or porch? A good-sized yard for entertaining?
Features To Avoid
Now that you have a good idea of things that would increase the resale value of the home, let’s talk about some red flags to watch out for. These aren’t dealbreakers, just things to think about when considering the eventual resale value of the home.
Here are some features you might want to avoid:
One bathroom homes sell for significantly less than homes with at least two baths, and they generally take longer to sell.
Heating Systems: Baseboard, wall, and floor heat are not as desirable as central heating systems. A fireplace in the living room is a plus.
Tubs and showers in outdated colors or scratched from years of improper cleaning might be hard to change without ripping out doors or walls, and people don’t always want to purchase a home that needs immediate renovation.
Popcorn ceilings (i.e., those bumpy ceilings that were so popular in the 1970s) tend to date a house. You can always remove them, but the removal process can be lengthy and pricey, especially if asbestos is involved.
Poor flooring choices: In general, carpet is less desirable as are laminate and linoleum flooring, especially when compared with hardwood, tile, and engineered hardwood.
When buying your home, your first objective should always be to buy a home that’s right for YOU, based on your lifestyle, family, and day to day needs.
However, when done right a home should be able to do two things for you…
- Provide a place to live
- Help you build long term wealth
When you take resale value into consideration up front, especially if you know you’ll move again within three to five years, you ensure that you’re maximizing your chances of reaching your financial and wealth goals.
Working with the right real estate agent to help you make a careful and strategic purchase now will help you maximize the appreciation and equity in your home over the coming years, giving you the option to sell the home and upgrade to a different home as your family grows, or refinance and pull out some of the equity.
We’re Here To Help!
If you’re in the market to purchase a home in Bluffton, Hilton Head Island, and the surrounding Lowcountry we’re here to help. We know the local real estate market intimately and can help you assess the potential resale value of a home so you can make the best decision for your family and wealth goals.