Prior to the economy and real estate market imploding, the prices at which homes were listed seemed to belie their underlying value. Amidst the economic wreckage, however, an important lesson has surfaced even as prices have plummeted: some properties retain their value better than others. The question is, why?

In this article, we’ll take a closer look at the types of houses that have managed to hold their value during the recent recession. By noting the differences between them and other properties, you’ll discover a few valuable guidelines that can help you purchase a home that is all but recession-proof.

An Ideal Location

Location has always been a key barometer to a house’s tendency to retain its value. But it’s worth noting that most of the price stability during a down market is due to the land on which it sits. It is valued at a particular amount because the location is coveted by others, and limited in supply.

For example, waterfront property usually commands a higher price than houses built miles inland. Similarly, a property located in Beverly Hills will likely command a higher price than a property of a similar size located in the heart of Los Angeles. During the most recent recession, prices of houses in good locations declined by a smaller proportion than other properties.

A Good Neighborhood

A good neighborhood is related to a coveted location, but extends further to include schools, stores, hospitals, and public services. Homes for sale near high-quality schools command a premium. So, too, do properties located in neighborhoods with plenty of shops and restaurants. Houses that are near public parks, hospitals, libraries, and other public services also tend to retain their value during a downturn.

“Better” Properties Nearby

Few homebuyers consider the effect better homes (i.e. those that are bigger, more lavish, etc.) have on the prices of nearby properties. They provide support. For example, suppose you purchased a 2,500 square foot house that was located near several 4,000 square foot estates. In a recession, you could expect the decline in your house’s value to be less than that for a similarly-sized home elsewhere. The presence of larger properties nearby supports its price.

Low Ongoing Expenses

Many homebuyers are surprised by the amount of money they have to spend in order to maintain their home. In addition to property taxes and your monthly payments on your mortgage loan, plan to pay for homeowner’s insurance, ongoing maintenance, and utilities. In some cases, you’ll also need to pay homeowner’s association fees, which can climb into the hundreds of dollars.

When the time comes to sell your property, you’ll discover that lower carrying costs translate into more demand from potential buyers. This increased demand helps support the property’s value. For this reason, when you’re looking at homes for sale, inquire about the ongoing expenses.

Remodeling To Preserve Value

Upgrading your property is a sure path toward increasing its value. But it won’t necessarily ensure your house retains its value unless the upgrades match the wants and needs of potential buyers. Properties offering three bedrooms and two baths are always popular. So, if you’re deciding between a large outdoor landscaping project or adding another bathroom, the latter will do more to help your home retain its value.

Another area where remodeling will help support your house’s price is to improve its environmental friendliness. For example, upgrade the insulation to help the home conserve energy. Doing so will reduce the amount of money a potential buyer will need to spend on heating and cooling costs. Buy energy efficient appliances that will further reduce the expense.

The recent recession offers a stark reminder of the qualities that make a home more attractive to buyers. The more appealing your future house is to potential buyers, the better its price will perform in a soft real estate market.

Author Bio: Great deals available for Harrisonburg homes for sale” and real estate offerings at http://www.ValleyFarmsandLand.com

Category: Real Estate
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