5 unexpected things that can tank a home's resale value
Maryalene LaPonsie | Improvement Center Columnist | February 24, 2014
When it comes time to sell a home, you can do everything right from creating great curb appeal to updating kitchens and bathrooms and still have trouble selling.
Resale value is about more than your home itself; it is also impacted by everything from the neighbor's yard to the school down the street. If you are buying a home, you'll want to be on the lookout for these five things that can unexpectedly take your resale value through the floor.
A neighborhood full of foreclosures can mean a bargain price for you now but may make it difficult to sell later.
As of last year, the foreclosure process was taking an average of 477 days and that number doesn't include any time the owners may have spent trying to sell their house via a short sale. If you are buying a starter home or move frequently, you may want to reconsider the neighborhood. There could be plenty of bank owned properties in the area for years to come, and that's not a good scenario when you are trying to get full-price for your home.
Even if you are prepared to live in the home for the long haul, that wave of foreclosures could still impact your resale value years down the line. Depending on the zoning regulations in your area, those foreclosures could be snatched up by investors and turned into rentals.
A long dirt drive
You might love the seclusion, but future buyers may see dollar signs when they see a long dirt driveway. In northern regions, it will need to be plowed with each snowfall, and in the spring, it could be prone to wash-outs, need smoothing or require dust reduction applications. Plus, driving on dirt can be tough on many vehicle suspension systems.
The same goes for dirt roads in general. Some buyer's may embrace the country life, but others will be looking for a less high-maintenance drive to and from their house.
The cell phone tower down the street
Selling a house can be all about location, location, location. Before you buy a house, look for these local features that could deter future sales.
- Cell towers
- High voltage power lines
- Power plants
Of course, even if none of these are present now, there is no guarantee they won't go in at some point during the future. However, you can hedge your bets by contacting the local municipality and asking for information about the nearby zoning districts and what types of uses are allowed on those lots.
Expensive utility options
In October 2013, the U.S. Energy Information Administration said those using natural gas for home heating could expect to spend an average of $679 this winter season. Meanwhile, those using propane were expected to spend more than double, $1,666 for the season, and that figure was calculated before the the price of propane hit a record high of nearly $5.00 per gallon in January 2014.
Wells and septic systems can also scare off some buyers who are concerned about costly repairs or possible contamination of drinking water.
Failing local school districts
Finally, even if you don't have kids, your future homebuyers may. The National Association of REALTORS reports 25 percent of 2012 homebuyers indicated school quality was a deciding factor in their purchase.
You can go to school ratings websites such as GreatSchools.org to see how schools in the area fare as well as whether there are private or charter school alternatives nearby.
Of course, you may love a house that is heated with propane, has a long dirt drive and is next door to a cemetery. There is no reason not to buy that house if you think it is your forever home, but be realistic about how long you plan to live there.
If you have a job that requires you to move frequently or think you are going to upgrade in a few years, you'll want to think twice before buying property with any of these resale value threats nearby.