What Lowers Property Value – 15 Surprising Factors | Jefferson County Real Estate | Shine Realty (2024)

What brings down property value? Here are 15 surprising things to consider that might lower the property value of your home.

Sometimes lower property values are due to factors with your property, such as neglected maintenance, outdated kitchens, or patchy home improvement projects. Other times, your home’s value can be reduced by things out of your control, such as messy neighbors, nearby foreclosures, power lines, natural disasters, your local real estate market, or the overall economy.

If you want to improve your home’s value, keep reading to find out which factors you can do something about (and which you can’t).

Things Bringing Down Your Home’s Value

There are some factors that affect property damage directly related to your home. Most of these are things a homeowner has control over.

1) Delayed or Neglected Maintenance

Putting off maintenance or neglecting to do it at all can lead to lower property values because they can lead to expensive repairs later. A small leak in the plumbing may not seem like a big deal at first, but over time it can cause structural damage, high water bills, or mold.

Here’s a healthy home maintenance checklist from the U.S. Department of Housing and Urban Development to help you keep your home in tip-top shape.

2) Sloppy Home Improvement Projects

DIY projects can save a lot of money upfront, but only if the job is done right. When repairs or remodeling projects aren’t done well or up-to-code, they may cause issues or result in code violations later on.

• uneven deck boards and railings
• warped flooring
• crooked tiling
• gaps between flooring and walls
• inadequate or exposed wiring

Basically, if it looks like Uncle Bob came over and did some work after a handful of beers, your home’s value is going to decrease in the eyes of potential buyers.

Making sure home improvement projects are done right and built to code can actually save you money and headaches in the long run.

3) Outdated Kitchens and Bathrooms

Outdated kitchens and bathrooms can also affect your home’s value in the eyes of buyers. A small 1970s range oven might work, but most of today’s buyers are going to be calculating how much it will cost to update the appliances and remodel very outdated kitchens and bathrooms.

The same goes for those all-pink bathrooms. Except for a few Barbie fans, most house hunters are going to remember your house as “the one with the pink bathroom” while subconsciously calculating how much work and money it will take to get a more modern bathroom.

• Related: Consider These Paint Colors to Sell if you need to update your paint.

4) Damaged Roof

Damaged roof shingles or leaky roofs are red flags for buyers, so if your roof doesn’t look in good condition, it could bring down the property’s value.

Ensuring you have a solid roof on your home is another way you can increase your overall property value.

• Related: If you’re local, here are some Wisconsin Contractors and Suppliers we’ve used and heard good things about, including roofers.

5) Mold or Mildew Damage

Since mold remediation can be pricey and mold can spread quickly, signs of mold can bring down property value.

If you have any signs of mold or mildew, it’s best to get it properly taken care of.

6) Asbestos

Asbestos is another word home buyers don’t like to see on their potential homes. So if your home was built prior to the 1980s and has known asbestos (which needs to be disclosed on a real estate condition report), this could lower the home’s value.

• Related: Here are some Wisconsin Contractors and Suppliers we’ve heard good things about for mold and asbestos mitigation.

7) Smoking

Not everyone minds the smell of smoke, but most non-smokers don’t want their home smelling like smoke of any kind. Smoke can be a hard smell to get out of walls, carpets, window coverings, etc.

So if you smoke in the house or your tenants in a rental house smoke, it could be a factor that reduces your property value.

8) Unhelpful Tenants

The wrong tenants in your house can deplete the overall home value in several ways:

• if they don’t treat the property well
• if they don’t let realtors and potential buyers in
• if they smoke and the property smells bad or weird

Hopefully, your rental agreement has something in place about how the property should be cared for, what behaviors are or are not allowed, and they’re pleasant to real estate agents and prospective buyers when the time comes to sell.

Mother Nature Can Lower Property Values

The weather and natural disasters can also bring down property values. Things like hurricanes, wildfires, floods, tornados, and earthquakes can cause a lot of damage to properties.

While no fault of your own, these things can lessen your property’s value.

9) Natural Disasters

If your home is damaged by a storm or major natural disaster, it can bring down the property value.

Fires, earthquakes, and hurricanes also can cause devastating physical and financial damage to homes, which can lessen a home’s property value.

10) Flood Zones

Homes in high-risk flood zones can also have a lower property value since homeowners with federally backed mortgages are required to purchase flood insurance.

The risk of flood damage can also be an added worry for homeowners.

Market Factors Affect Property Values

Property values are impacted by the current real estate market, supply and demand, and interest rates.

These factors are out of the control of homeowners.

11) Changes in the Real Estate Market

Supply and demand for homes can also affect property values. Generally, when the demand for homes is higher than the supply, property values increase.

When there’s more supply than demand, property values decrease.

According to Freddie Mac research, the United States had a housing supply deficit of 3.8 million homes at the end of 2020. Higher demand than supply combined with lower mortgage rates, caused a huge price increase in homes. And even now with higher mortgage rates, the house prices still have not decreased much if at all in our area, due to supply and demand.

• Related: Best Time to Buy a House in Wisconsin

12) Mortgage Rates

The current interest rates on mortgages can affect the price buyers can pay for your property.

When rates are low, buyers can afford the payments for a higher-priced house or land because less of their monthly payments will be going to the bank for interest.

When interest rates increase though, more of the monthly payment is going toward interest, so buyers cannot afford a higher-priced property.

This depends on your area, but in general, higher mortgage interest rates can make home prices go down because more buyers have less money to spend.

• Related: How to Buy a House with Bad Credit

Neighborhood Factors Can Bring Down Property Values

The people and places in your neighborhood can also impact your property value.

If your neighborhood looks unkempt, if it’s noisy, if there are foreclosures, or if there are things like power lines, low-income housing, and gun ranges nearby, these could drop the value of your home.

Location and noise are factors homeowners cannot do anything about, but they are factors to be aware of when considering the market value of your home.

13) Noise Pollution

If your home is located where things like loud traffic, sirens, or emergency service vehicles can be heard, the noise pollution could bring down your home’s value.

Even local construction, gun ranges, and loud neighbors (pets or people) can impact your property value.

If it’s too noisy when buyers walk through your home, they may walk away from the purchase or offer less.

14) Proximity to Things That Look, Smell, or Sound Bad

The location of your home matters. There are a few examples in this list, but there could be more. Things that look, smell, or sound bad can reduce property value.

Some examples are:

• Landfills
• Power plants
• Strip clubs
• Cemeteries
• Smelly farms
• Registered sex offenders
• Abandoned properties (aka “zombie homes“)
• Factories
• Junkyards

15) Foreclosures in Your Neighborhood

Foreclosures in your area can reduce the value of your property, especially if an appraiser uses it as a comparable sale (“comp”).

Foreclosures often decrease the value of an area in the buyers’ eyes, especially if the foreclosed property is in shambles.

Get Your Home Ready For Sale

If you’re thinking about selling your home, we’d be honored to help you every step of the way. Get in touch with a Shine Realtor or if you want to do more learning on your own in the meantime, here are some resources we’ve created to help people like you:

• FAQs About Selling a House
• Proven Tips to Sell Land Fast
• Can I Put in an Offer on a House Before I Sell Mine?
• Great Paint Colors for Selling a House
• How to Hire a Real Estate Agent to Sell Your House
• When is the Best Time to Sell a House
• Top 10 Moving Companies Between Madison and Milwaukee, WI
• The Complete Guide to Selling Your House

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