Whether you are selling or buying an investment property or home, you need to consider what the property is really worth.
A better understanding of what makes your property more (or less) valuable would help you maintain the long term value of your home or assist in your purchasing/investment decision.
So what are the factors that affect property value?
It is the oldest cliché in the book, but this is probably the prime factor in determining the value of your property. For example, in Klang Valley, the value of your property is generally higher the nearer you are to the city centre. That is why home prices in the Kuala Lumpur central business district have skyrocketed in the last decade.
But location is linked to numerous other factors too. If your home is within the vicinity of something undesirable – such as a cemetery, power stations or a waste disposal area – that could be detrimental to the property’s value.
A valuer’s insight: Properties that face a western orientation tend to be less valuable as the afternoon sunlight comes in at an almost horizontal angle. This may lead to higher costs incurred to increase the cooling of the property. Also, homes that face a T-junction tend to be less valuable due to the risks associated with increased chances that vehicles might collide with the gates of the said properties.
2. Accessibility & Amenities
If your property is near a newly opened major highway, that might increase its value. A good road network and presence of public transit nodes such as LRT and MRT stations are huge plus points these days. Many aspiring homebuyers who live in urban areas base their purchasing decisions on the commute time to their workplace!
Proximity to conveniences such as clinics and private hospitals, educational institutions, banks and shopping malls, international or private schools may boost value too. These ‘hotspots’ make your home and the neighbourhood all the more livable.
3. Maintenance & Renovations
This goes back to the previous points of age and quality. As the property gets older, it could face problems and issues that need addressing – from plumbing to roofing, just to name a few. However, a building that is made of high-quality materials might hold together longer before having any issues.
This is where regular maintenance comes in. Just like how you inspect and service your car on a regular basis, properties also need to be checked constantly for any defects. A property that is well-maintained would fetch a better valuation in the long run than one that is completely neglected.
A valuer’s insight: Valuers will take into account renovation works done which enhances the livability and aesthetic value of the property such as:
a) change of flooring;
b) permitted extension;
c) built-in kitchen cabinet(s) and wardrobe(s);
d) plaster ceiling(s)
f) alarm system(s)
g) auto gate system.
4. Quality of Construction
The quality of the construction of your home or workmanship is another key element in preserving the value of your asset. Not to mention, the quality of construction materials used – a building that is made of high-quality materials might hold together much longer before having any major issues.
We often hear about homes that were constructed many decades ago but still fetch a premium price due to the quality of the building materials, workmanship and structural design. The decades-old terrace homes in Taman Tun Dr Ismail (TTDI) and Bangsar serve as great examples – these units might be bread and butter homes, but they are now going for at least RM1.5 million each.
On the other hand, many complain that even expensive units offered by top developers nowadays have average quality, due to the use of sub-par materials to cut costs. Hence, it is crucial that you do your due diligence and not be swayed by marketing gimmicks such as fancy brochures and attractive freebies.
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