Real Estate Value: Analysis of Real Worth

 Real estate is one of the most valuable investments you can make. Real estate in New Jersey is especially valuable. There are many reasons why real estate can be valuable, but the age-old adage is usually right: Location, location location. At ERA Othello Realty we look at all the criteria that make up real estate value.

Real estate can have value because it's valuable to a specific individual, but overall the value of real estate is what the general public (in the market) will pay for it. A residential home's value can have many pluses and minuses, but if all other things remain the same then the location determines the price.

There are different criteria with different types of real estate that determine what location is valuable for a specific piece of real estate. For a commercial property it might be important to be on a main road with a lot of traffic. For industrial real estate it might be important to be near railway lines or away from high traffic areas.

For residential real estate it becomes more complicated. "Residential real estate" means someone's home. A home is the most personal piece of real estate and, usually, the most important real estate that s/he will ever own. There are many reasons why one location will be more valuable than another.

Schools very often are the driving force behind a person's determination to stay in a specific place or to move to a specific place. In this case "real estate location" is something that isn't a specific "vicinity" issue but rather a municipality issue. So this piece of real estate will have a different value for someone with children than for someone without children. So a good school system will only drive up the price for certain people, as such it only has a partial affect.

Transportation is a huge factor for people who need to travel to work. In Central New Jersey, which includes Middlesex County, Monmouth County, Mercer County and parts of Ocean County and Burlington County, people very often need to travel to Northern New Jersey or New York City. If the home is close to a major thoroughfare, such as the Garden State Parkway, The New Jersey Turnpike, Route 1 or 9, it can have a very positive affect on desirability for long-commuting buyers.

Mass transit is also an important factor to commuters who use it. The New Jersey mass transit system brings millions of commuters north every day and certain people will pay more to be close to it.

Some people like their homes very secluded, surrounded by a lot of land and some people like their homes in a cozy development. As a general rule, though, the more land, the more someone will pay for that piece of real estate.

The size of the house has one of the strongest impacts on the value. A small house on a small piece of land has a much lower real estate value than a medium house on a small piece of land. This is obvious. There is a time, though, that a house too large for the land can reach a peak with it's real estate value.

A combination of land and home size is second to location in real estate value. Let us not forget about the condition of the total piece of real estate. The real estate condition is usually on the home itself but it can also be on the land. A nice manicured lawn with a lot of nice trees can be a boon to the property's worth.

The condition of the house itself is very important. A house that needs some "TLC" (or tender loving care) has amuch lower value than a house that is "as new." While this might be obvious, it should also be obvious to a home seller that they should fix up their house as much as possible. The same idea of "an ounce of prevention is worth a pound of cure." Making sure the paint is perfect, the carpet nice, no cosmetic flaws can have a much larger value -add than the cost of fixing it up. It's not always the case, but it usually is.

New Jersey is called The Garden State for a reason. It used to be much more rural. Parts of it, mainly in Southern New Jersey, are still much more rural. As the New York Metro area grew, though, it transformed Northern NJ, and now Central NJ into a more suburban locale. This, in turn, has driven up real estate values. The NJ Real Estate Market has surged incredibly these past 10 years.

As NYC real estate prices have climbed people have started to move out of NY and into, relatively, cheaper New Jersey. These cheaper suburban real estate prices, in turn, have attracted more people, which drives up real estate demand and real estate prices. When the prices in Northern Jersey go up people look further south into Central Jersey and then the cycle repeats itself. But, in general, the prices of central and south New Jersey are cheaper than northern. Central NJ is cheaper than South NJ.

So, in review, here are the important criteria for real estate value:

* Real Estate Location * Real Estate Condition * Real Estate Size * Real Estate Vicinity * School Districts * Transportation (Roads) * Mass Transportation

I hope this real estate tutorial is a help in your next real estate purchase or sale. Copyright 2005 Cy Yablonsky. Cy Yablonsky is an Associate Realtor with Othello Realty, you can visit Othello Realty at http://www.OthelloRealty.com. Feel free to reprint this article but you must include this paragraph and all links must be live and working, no changes can be made.

About the author:

Copyright 2005 Cy Yablonsky. Cy Yablonsky is an Associate Realtor with Othello Realty, you can visit Othello Realty at http://OthelloRealty.com. Feel free to reprint this article but you must include this paragraph and all links must be live and working, no changes can be made.

 Cy Yablonsky

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