Threats to Your Home’s Value

Threats to Your Home’s Value

Even though we all like to think our homes are perfect, potential buyers and appraisers have eyes trained to see even the slightest negatives of a property. Take a look at some of the threats that can lower your home’s value so you can avoid unpleasant surprises when you decide to sell.

my new house
My New House by Michael Gil

Location-related Threats

Impact of neighbours in the area

We can’t really pick our neighbours, but they surely can and do affect the value of our properties. Take such a minor factor as clotheslines in your neighbours’ gardens. According to a survey by the California Association of Homeowners Associations, clotheslines might reduce the value of the property by 15 per cent. Why? Some might say they’re an eyesore, while others view them as a symbol of low social status. Even though experts have lately disputed the impact of clotheslines on sales price (going green is in fashion and organizations fighting for clotheslines seem to be winning at the moment), the discussion still shows how fragile home values can be.

Clothesline by Peter Blanchard
Clothesline by Peter Blanchard

Similarly, if the neighbourhood gives a run-down impression, it doesn’t matter how beautiful your house is. As long as the neighbours don’t care about mowing their lawns, getting new paint jobs to replace ugly, peeling exterior paint, or keeping debris off their property, the sale price of your property can easily be as much as 10 per cent according to an estimate by Joe Magdziardz, president of Appraisal Research.

Another issue with our neighbours is that we can never affect who lives in the area. If there happens to be a known drug den or sexual offenders that live nearby, the perceived value of your home goes down. Buyers’ interest would also suffer if there were a murder, rape, or any other violent crime in your area reported in the news — and the bigger the story, the lower your chance of getting a good sale price.

Crime Scene by Alan Cleaver
Crime Scene by Alan Cleaver

Rental properties and noisy neighbours

Buyers don’t really like the idea of living near rental properties. There are several reasons for this trend. Firstly, homeowners believe that people who rent instead of purchasing their homes don’t maintain the properties well, as they know they won’t stay very long. Plus, there’s also a widespread feeling that renters are often young people and students, who tend to organize parties and be generally noisier than settled families. Because it’s not easy for prospective buyers to spot noisy neighbours during day visits, some insist on coming over at different times to check noise levels. And as soon as they happen to come during a party next door, be prepared for a major price drop. Appraisal Institute president Richard L. Borges agrees with this claim, as the institute’s findings seem to prove the point. “I’ve seen many situations where external factors, such as living near a bad neighbour, can lower home values by more than 5 to 10 per cent.

Power plants, landfills, industrial complexes

Nobody likes living in an industrial zone. Power plants and industrial areas close to the property — not to mention landfills — lower its value considerably. Some might say it’s just a slightly irrational desire for a nice middle-class neighbourhood with a forest or stream that we all long for. But there are still many real issues connected to living close to industrial areas, such as possible water and air pollution and excessive noise. As for nearby landfills, potential buyers are particularly sensitive to hearing it’s a hazardous waste site.

More Than Enough by GanMed64
More Than Enough by GanMed64

Railroads and highways

Even though it’s generally a good thing to have railroads and highways conveniently close to your home, there’s a fine line where an advantage turns into a downside. How close is too close? Hearing traffic noise is the ultimate value killer. It’s also a problem if your neighbourhood is cut by a highway or you need to cross highways when walking around, as it distorts public space and kills the outdoor spirit.

Lack of good schools

If your kids have grown, you might easily forget how important good schools are for young families. In addition to the impact of schools’ quality, decent connection and proximity also play a vital role. Nobody wants to spend 40 minutes in traffic driving the kids to school every morning, and house prices reflect this preference too. A study by the St. Louis Federal Reserve Bank states that “the price premium from school quality remains substantially large, particularly for neighborhoods associated with high-quality schools.

De La Salle by
De La Salle by LoozrBoy


On a national level, too many foreclosures obviously bring down home values. If there are a few foreclosures in your area, you shouldn’t have it too bad. But too many can slash your home value. The trouble comes when buyers have a whole range of homes sold at foreclosure prices to choose form. In this case, nobody would go for your “normally” priced property. As well as pricing issues, ongoing foreclosures also pose a security risk, and deserted houses gradually lose value due to the lack of upkeep. The bottom line is clear: if you don’t think the foreclosures in your area will continue forever (that is if your city isn’t Detroit and there’s a chance of improvement), don’t lose your money by trying to sell.

Threats Concerning Your Home Itself

Lack of updates

“If your house is not updated, you might as well not sell it,” says Amy Downs, a Dallas-based real estate agent. Don’t underestimate the power of renewed paint on the walls, new appliances, or a modern bathroom. Buyers appreciate when they can move in and start using the property without any major renovations. Even though it might seem illogical for you to invest in a house you’re not planning to use anymore, real estate math has different rules. Usually, for each well-invested dollar, you get two in return, as the sale price rises notably with certain new updates.

My New Kitchen by mahinui
My New Kitchen by mahinui

Bad floor plan

Even though on paper, your property might seem big, ineffective floor planning can considerably reduce the perceived size of the space. If there are too many walls blocking the daylight or uselessly big hallway at the expense of other rooms, appraisers will surely reflect these inconveniences. Take this into consideration before buying or selling your home — especially when it comes to older structures, as airy, open-plan layouts have only become fashionable in recent decades (remember your grandparents’ house with a single hallway and a couple of bedroom doors?). You’ll be surprised how the thoughtful removal of a wall or two can raise the value of your home.

No garage, no pool

This point is quite obvious but still worth mentioning. The added value of a garage varies, and it’s especially important to reflect on the nature of your property. If you own a mansion, a one-car garage might not be enough — but buyers will appreciate a single garage on packed downtown streets. Buyers can view pools either as an asset or a nuisance. If pools are a norm in your neighbourhood and everybody’s used to spending hot summers swimming in the backyard, not having a pool will certainly lower the value of your property. On the other hand, having a pool in a region where it’s not common might put off buyers, as they won’t be willing to pay extra money for the hassle of keeping the pool.

No fence

Families often look for houses where they’ll be able to enjoy the luxury of letting their children play outside without worrying too much about their safety. The same applies to pet lovers, who want to allow their dogs a little freedom outdoors. According to Danny Wiley, a Tennessee appraiser, buyers pay a premium for fences. So building at least a small fence around your house can increase your chances of getting a reasonable price. Similarly, you can add extra value to your home with porches and decks, as people like to imagine themselves spending summer evenings outside.

White Picket Fence by Laura D'Alessandro
White Picket Fence by Laura D’Alessandro


Pets in the house, cigarette smoke, or too much dust at the time of a buyer’s visit can kill the deal. Especially people who are allergic to pets tend to back out, as getting rid of all the animal hair and allergens can take a lot of effort. Nobody expects you to put your animal friends away, but when it comes to other allergens, take great care to clean the house as thoroughly as possible so you don’t lose contracts or money due to such a minor issue. You can rent an ozone generator that will help you get rid of unpleasant odours as well as mould, mildew, and fungus. The generators are affordable to rent — at $70 to $150 for two days, they’re certainly worth the investment.

Do you have any experience with threats to home value that you’d like to share? Let me know in the comments!

One Reply to “Threats to Your Home’s Value”

  1. Yes – some threats to location are, unfortunately, not ours to control (example being neighbours); the other points relating to the home you suggested are very helpful and can absolutely relate to a sale or not. Things such as updating rooms, fencing the property, adding a garage even, are how homeowners can take control and have a successful and happy sale.

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