Value is a key part of Vancouver luxury real estate. But how is value determined – and how can you increase the value of your Vancouver luxury real estate? Let me tell you!
The 5 factors that determine the value of your Vancouver luxury real estate
1. Supply and demand
One of the biggest factors that determines value – not just in Vancouver luxury real estate – is supply versus demand.
Think about it in terms of water. If you’re out and about in the city during the summer and you’re thirsty, you might pay $2 for a bottle of water. Why? Because there’s a great deal of supply.
If, however, you’re at the airport and there’s only one store selling water, you might pay $5 for a bottle. If you’re in the middle of the desert with only one bottle of water and tons of people wanting it, would you pay $100 for that same bottle?
That’s supply and demand. So, the more buyers there are and the fewer properties there are, the more value your Vancouver luxury real estate will have.
Real estate is all about location, especially in Vancouver. But what makes certain locations more valuable than others? There are a number of factors that come into play in terms of neighbourhood value. These factors include:
- Crime rates
- School district
The better your location is considered, the more value it will add to your home.
3. Interest rates and your mortgage
When interest rates are high, people pay more on their mortgages, leaving them with less principal to spend on their homes. That decreases the demand, lowering homes’ value – and making them more difficult to sell. If you want to make the most on your Vancouver luxury real estate, it can be beneficial to sell when interest rates are lower. But in a market as hot as Vancouver’s, there’s really no reason to wait!
4. Home renovations
Home renovations can add to the value of your home. Not all home renovations are made equal though! If you are trying to add value to your home, focus your renovations on the kitchen and bathroom. Watch bold paint colours and fixtures as these may not appeal to a lot of buyers.
This includes the potential for future development in the home and in the area. Basically, when people buy Vancouver luxury real estate, they want the property to increase in value. Further development in the area can raise home values, giving that increase. Having the space and ability to add on to the property’s home – if it is a house rather than a condo – also gives the potential for an increase in value in the future.
How to increase the value of your Vancouver luxury real estate
Given these five factors, how do you increase the value of your Vancouver luxury real estate? You focus on what you can do, when you can do it. When you are in the process of purchasing a property, pick a strong neighbourhood with a high potential for future development. Once you have a place, the best way to add value is through renovations.
If you aren’t sure which renovations will add the most value, we can set up a consultation. I will look at your home and advise you on the best ways to add value before putting your Vancouver luxury real estate on the market.