What makes property value increase?
February 25th, 2010 | by admin |I’m just confused as to why after people live in a home, the property value increases; but when people drive a car, the value decreases? I guess I understand that cars get worn out and mileage gets higher along with problems that come with it. But wouldn’t homes sort of be the same? Any input is great. Thanks!
Inflation.
The need for the city, town, village, county (or whatever taxing entity the property in question is in the jurisdiction of) to collect more money in taxes without raising the tax rates. This is usually capped at some percent.
Improvements done to the property like adding on more square footage. Landscaping, Remodeling–updating old appliances, carpets, a new roof, etc.
Real Estate Prices: If you buy a house valued at $140000 on its TAX appraisal for $200,000; you are now telling the tax district that it is now worth $60,000 more in taxes and will get taxed on that. Of course if you buy the same $140,000 house for $100,000 you are now telling the tax district that it is now worth $100,000 and will get taxed on that amount. The thing is that when it comes to selling you will sell it at Real estate prevailing prices and not necessarily on Tax appraisal values since they are not one in the same.
In Texas you get a homestead exemption and your house for tax purposes can only go up 10% per appraisal year. Depending on what you paid for it your tax appraisal may or may not be lower or higher than the real estate appraisal rate–which is sent with your appraisal, but is more of just showing you what it should approximately sell for.
A shortage in houses available for sale for whatever reason. Sometimes homes go up in value because they are in a very popular area and there is no more land left to build new homes, so if you are a late comer and really want to live there you are going to have to pay or live somewhere else.
Hope this helps.
7 Responses to “What makes property value increase?”
By alpha66 on Feb 25, 2010 | Reply
landscaping can increase the property value by 10-15 %
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By judy b on Feb 25, 2010 | Reply
updates to kitchen and bathrooms. nice landscaping and a desirable neigborhood and more than one bathroom.
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By Wonder on Feb 25, 2010 | Reply
There is only so much dirt. When it’s gone, it’s gone. As a result, the cost of land continually goes up. The structure obviously goes up because normal inflation occurs. Cars are built all day and all night. There will never be a shortage of them. Go buy yourself some dirt.
-MM
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By jxt299 on Feb 25, 2010 | Reply
Its supply and demand, same as anything else. Houses are in demand, high demand. Cars…cars can be in high demand, too, like collectors items–old T birds, old Corvettes, or Franklin Roosevelt’s specially equipped Packards–those are worth a huge bundle. But a standard car, driven off the lot, loses its value as a new car immediately. It can acquire a collectors value if, say, the owner is somebody famous, but if its just an ordinary citizen, the value will only go down.
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By James L on Feb 25, 2010 | Reply
Adding additions to your home and putting in landscape adds equity to your home. You can’t drive a home…
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By patty_loves_to_travel on Feb 25, 2010 | Reply
Inflation.
The need for the city, town, village, county (or whatever taxing entity the property in question is in the jurisdiction of) to collect more money in taxes without raising the tax rates. This is usually capped at some percent.
Improvements done to the property like adding on more square footage. Landscaping, Remodeling–updating old appliances, carpets, a new roof, etc.
Real Estate Prices: If you buy a house valued at $140000 on its TAX appraisal for $200,000; you are now telling the tax district that it is now worth $60,000 more in taxes and will get taxed on that. Of course if you buy the same $140,000 house for $100,000 you are now telling the tax district that it is now worth $100,000 and will get taxed on that amount. The thing is that when it comes to selling you will sell it at Real estate prevailing prices and not necessarily on Tax appraisal values since they are not one in the same.
In Texas you get a homestead exemption and your house for tax purposes can only go up 10% per appraisal year. Depending on what you paid for it your tax appraisal may or may not be lower or higher than the real estate appraisal rate–which is sent with your appraisal, but is more of just showing you what it should approximately sell for.
A shortage in houses available for sale for whatever reason. Sometimes homes go up in value because they are in a very popular area and there is no more land left to build new homes, so if you are a late comer and really want to live there you are going to have to pay or live somewhere else.
Hope this helps.
References :
By Cool girl on Feb 25, 2010 | Reply
The main reason for property value to increase is the shortage of land and more demand for it as everyone wants to live in a house but they can live without a car and use public transport.
References :
http://www.smart-investments.org