Estimating the value of your property is extremely important in order to get a clear idea of how you "stand" in the market. You can try to evaluate the property yourself, but if you want a professional judgment, ask for the help of a real estate agency.
You may be wondering if you should sell your home and use its equity in this time of rising real estate prices? While considering some of your options, you first need to know how much your house or apartment is actually worth. You can find out the value of the real estate in several ways. To begin with, you, as the owner of the property, can browse classified ads and estimate the value of yours based on similar properties. And you can hire an expert, which we highly recommend.
What is the market value of real estate?
The market value of a property is estimated by comparing one property with similar properties in the same area. In simpler terms, you need to "analyze" how your home looks in the eyes of prospective buyers compared to other homes in a location. It is necessary to take into account the selling price of a property similar to yours. That it has the same number of bedrooms and bathrooms, that it is approximately square footage, that it has additional outdoor space... If you work with a real estate agency, then the overall evaluation of your home begins here.
Who does the real estate valuation?
As we mentioned earlier, the property owner can assess the value of his property by comparing it with other, similar properties. That way he can find out the real market price. If the financing takes place through bank loans, then an official valuation is applied, which is carried out by appraisers and authorized court experts. Based on the law, they are the only ones authorized to perform such actions. It is the appraiser's duty to provide other information such as the date of the purchase agreement, the number and area of the cadastral parcel, the name of the cadastral municipality and other information related to the characteristics of the real estate when performing this work. For built-up cadastral parcels, it is necessary to state the type, area and description of the building, street name, number and year of construction.
Methods for assessing the value of real estate
Valuation of real estate in Croatia is regulated by the Law on Valuation of Real Estate, which defines the responsibilities of administrative bodies, valuation methods, methods of assessing fees for expropriated real estate...
There are prescribed methods for assessing the value of real estate, and they refer to the comparative method, income and cost. The comparative method is used to determine the market value of built and unbuilt land, as well as residential buildings, garages, parking spaces, and so on. In this way, the market value is determined from at least 3 purchase prices of comparable properties. The income method is used to determine the market value of cadastral parcels on which residential and other buildings are built. The cost method is used to estimate the value of subsequent investments and possible damages and defects in individual buildings.
The aforementioned law deals with the market value of real estate, and its basis is examined by applying the methods and other procedures just mentioned. In addition, in order to obtain a relevant estimated value of a property, purchase prices, rents, management costs and so on must be used.
Factors affecting real estate value
The value of your property is based on how much buyers are willing to pay for your home, but keep in mind that every buyer is different. For example, for one family, proximity to a school and kindergarten is more important, while for others, square footage and the number of rooms in the apartment play a bigger role. We bring the most important factors that affect the value of real estate.
The location of your property may be ideal for you; it is close to the place where you work, it is close to your parents' house, etc., however, in the case when appraisers determine its value, they will use other important indicators such as:
• proximity to schools, kindergartens, shops,
• good connections with other parts of the city,
• employment opportunities,
• proximity to entertainment and recreational facilities,
The above-mentioned factors can influence why real estate is more expensive in some parts of the city and cheaper in others. In addition, proximity to highways and public transportation can also affect the overall value of a property.
In most cases, the location is even more important than the size and condition of the property, especially if it is located first row to the sea. The facts of whether the road passes in front of the property or not and "where the view from the balcony, living room or kitchen is" have a significant impact on the value of the property. If the future tenants will enjoy an unobstructed view of the pines and the open sea and thus strengthen their body and soul on a daily basis, they will be happy to spend a little more money, since the property itself is worth much more than the one located right above an important thoroughfare, from which the view extends only to neighborhood.
When assessing the value of a property, size is an important factor to consider, as generally speaking, a larger apartment or house can drastically affect the valuation, of course, in a positive way for you as the seller.
The value of real estate is roughly estimated by the price per square meter. The price per square meter often varies depending on the location of the property and whether it is a new building or an old building. In addition to the square footage, the useful area of the property is also taken into account when determining the value of the property.
Age of the property and current condition
Newly built properties are valued at a higher value, which is logical. The fact that important parts of each house or apartment are newer, such as plumbing and electrical installations, the roof, etc., are less likely to break down, so there are immediately visible savings for the customer. It is also good if the roof has a 20-year warranty; that's a relatively large amount of money the owner will save over the next two decades compared to an older home that will surely need to have its roof replaced at some point in the future.
Upgrades can increase the value of your property, especially if it is an old building. However, the impact of upgrades and other factors that can increase the value of a property depend on the market in which the property is located as well as its value. For example, a freed parking space can be worth more in the city center than outside the city center.
Buyer's market or seller's market?
Even if your property is in excellent condition, is in the best location and has everything a family or couple needs, the number of properties on the market in that same area as well as the "number of buyers" on the market can really affect its value. If the market is full of real estate sellers and the number of interested buyers is very small, then it is a buyer's market. This means that the demand for real estate is decreasing and that in this case it is the buyers who "determine" the price of the real estate, since they can ask for it at a significantly reduced price. In most situations, the seller agrees to this solution and adapts to the customer's requirements, especially if he wants to make a sale quickly.
Conversely, if there are a lot of potential buyers who are interested in a smaller number of properties in a certain location, it is a seller's market. This means that the demand is greater than the supply and that you, as the seller of the apartment or house, are free to dictate the price. Of course, you shouldn't go to any extremes, because that way you can negatively affect the entire buying and selling situation. For this reason, it is best to consult with experts.
Why is it important to know the value of your property?
Knowing the value of your property allows you to more easily determine the best selling price based on all the factors that affect it. In addition, this way you can estimate what you can actually afford.
We advise you to leave the evaluation of the property to experts such as, for example, real estate agencies. Experienced and professional agents trained to work in this field will give you clear information that interests you, and personalized approach, efficiency and effectiveness are their main characteristics.