How Properties Are Valued

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Unlike most of the things we buy, the value of real estate is generally a long-term investment. It’s important to know the fundamentals of real estate economics when you begin your search. This will help you find exactly what you are looking for much faster than just diving in. This is also why it’s important to work with a local realtor in College Station who knows the market and the properties, and can help you with these fundamentals.
Because of the time scales involved, an estimate of a property's value must take into consideration any governmental controls on the property (historical sites, ecological and environmental considerations, zoning, etc.), economic trends, and social trends that influence the four elements of value:

• Demand: The number of buyers looking for property on the market.
• Utility: (Use): The suitability of the property for the buyer’s needs.
• Supply: The number of properties available on the market.
• Transferability: The speed and ease of transferring ownership.

Demand is fairly straightforward. When you are looking for property, you are part of the overall demand. If there are many buyers looking for the same kind of property in the same price range, the demand is high. If there are only a few people, or they are all looking for different kinds and price ranges, then demand is low. Your local realtor will be able to tell you more about the demand in the area.

Utility is also something your local realtor will speak with you about. Whether you are looking for a place to build your dream home, a starter home, or that perfect place you can really make your own, there are a lot of possibilities. Your realtor will make sure to get to know you and your needs so that you can find the best place for you.

Supply is in the same boat with demand. If there are a lot of sellers, but not many buyers, that can greatly affect price. The same is true for having many buyers, but few sellers. These things can fluctuate rapidly, so it is in your best interest to have someone who can keep an eye on all the variables that will affect your purchase. 

Your College Station realtor will be able to walk you through what is going on in the local market so that you can make an informed decision.

Transferability is also an extremely important aspect of the value of a property. Does the owner have the title free and clear? That is always a nice scenario. But there are issues that can arise if there are trusts or other restrictions on the property. It is vital to have someone knowledgeable at your side in order to make decisions about whether or not to make a bid on a property that may require jumping through a few hoops. 

Even if you are willing to jump through some hoops for the right property for you, you want to make sure that you see them all before you start jumping.

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