How to Evaluate a Home's Resale Value

Three Parts:Considering the LocationSizing up the ExteriorEvaluating the Interior

While some people just see a home as a place to live, it can also be an excellent investment. When buying a home think about your needs, as well as the future and what a home's potential resale value may be. Learning how to evaluate a home's resale value is imperative to making a good return on your real estate investment.

Part 1
Considering the Location

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    Research the value of local real estate transactions. Examine not only the value of current sales in the neighbourhood, but trends over time. Purchasing a home for resale in an area where the value of real estate purchases have been steadily increasing is a good idea. Purchasing a home in an area where the value of real estate has seen wild fluctuations or downward trends is risky.
    • The National Association of Realtors maintains extensive statistics and other data on home sales in the United States.
    • Visit their website,, to conduct research on real estate transactions in the area where you are considering buying a home.[1].
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    Evaluate the quality of local schools and medical clinics, as well as community amenities. Many potential home buyers will value on access to good educational institutions, healthcare services, and recreational opportunities. The condition and proximity of everything from parks to doctor’s offices to sporting facilities will potentially have an impact on the resale value of a home. [2]
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    Assess local transportation linkages. Easy access to major roads and highways, as well as public transportation options, can increase the asking price of a home. But keep in mind that a home located too close to noisy rail-lines, freeways, and high-traffic areas will not fetch top dollar. Accessible transportation links are desirable; direct adjacency to noisy transportation infrastructure is not.
    • As people around the world rely less on automobiles, buyers will increasingly value walkability and public transit. [3]
    • Try entering the address of a home you are considering into, an online service that rates neighborhoods based on access to public transit, and proximity to services and amenities. [4]
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    Consider the view. A home facing a parking lot or a strip mall will sell for less than a home facing a river or a park. However, keep in mind that not everyone is willing to pay for a view. In other words, don't count on a “good” view bringing in top dollar when reselling a property. But keep in mind that a “bad” view will create resale limitations. [5]
    • Before purchasing a property, research whether there are any planned developments that might impact a home’s view in the near future.
    • If a home backs onto a forest or field, ask if the space is protected, and if might be developed into a new housing development, highway, or something worse.

Part 2
Sizing up the Exterior

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    Pay attention to the lot of a potential home. The dimensions of a lot should be roughly rectangular. Oddly-shaped lots are harder to resell. [6] Home buyers look for ample space in both front and back yards. A reasonable amount of space along the side of a lot is an added plus. Side-space helps to provide a buffer from neighbours.
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    Evaluate a lot’s elevation and slope. Lots that are unevenly sloped can be a problem in terms of drainage, especially if they slope downwards towards the house itself. In terms of resale value, look for lots that are level as possible. Avoid houses on lots with low elevation in comparison to surrounding terrain.
    • While landscaping can improve slope and drainage, undertaking such projects will eat into resale profits.
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    Consider how a house looks from the front street. First impressions mean a great deal in the real estate market, and for resale purposes you’ll want a house that has “curb appeal.” Look for exterior features and landscaping that is both complimentary and has room for improvement.
    • For instance, if a house has large windows that would provide excellent nature light, but dense trees blocking them, imagine how simply pruning or removing trees might add to the resale value. [7]
    • If a house has dated features such as window awnings, imagine how its appearance could be transformed simply by removing them.
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    Avoid an overly-landscaped yard. It generally adds to the home's sale price, and you may not get your money back. An open yard free of clutter is more likely to become a canvass for the desires and fantasies of a potential buyer. [8]
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    Privilege a two-car garage and private driveway. Many buyers will have at least two cars, and might be turned-off by a shared driveway. While it is possible to build an addition on a single-car garage, such an addition would detract from resale profit.

Part 3
Evaluating the Interior

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    Purchase a home that has 3 to 4 bedrooms. This is the ideal size for potential resale. Two bathrooms are also a must, and a 2 1/2-bath home is best for resale. [9]
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    Evaluate storage space throughout the home. Walk-in closets are popular in bedrooms, especially the master bedroom. But it's also important to have a bathroom closet for linens and towels.
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    Buy a house with a large kitchen and adjacent dining room. Most home buyers also look for the family or living room space to be fairly close to the kitchen. Access to the backyard from the kitchen is ideal for barbecues and outdoor parties. Many people like a kitchen close to the garage, which makes it easy to haul loads inside. [10]
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    Consider finding a home that has laundry facilities on the main floor that are out of the way from the main living spaces. Some buyers are turned off by having to haul laundry into the basement. Make sure the laundry room will be big enough not only for a washer and dryer, but for an ironing board and storage.
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    Weigh the pros and cons of fireplaces. One fireplace in the main living or family room will probably suffice. Too many fireplaces in one home will most likely not be worth the additional cost. [11]
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    Privilege homes with hardwood floors over carpet. Many buyers are not fond of carpet, as it locks in dirt, dust, and odors. Another benefit of hardwood floors is that they can be decorated with area rugs suited to individual tastes and colour schemes. [12]


  • Avoid buying the largest or smallest home in a neighborhood. You want something that is average to the other houses on the block when running comparable home prices. [13]
  • Increasingly, energy efficient and green energy homes are gaining resale value. Studies have shown that homes outfitted with roof-top solar panels can add tens of thousands of dollars to asking prices. [14]


  • Swimming pools are not as attractive to buyers as they used to be. Pool maintenance and safety issues deter many buyers. [15]

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Categories: Buying Property | Selling Property