What are the Factors Affecting Value of the Property?

Purchasing a property is a dream of almost every individual living on this earth. Everyone wants their own built shelter where they can live without any boundaries. Building a house is the biggest financial investment anyone can make. Looking for a decent apartment or land may require some hectic hours, but in the end, it’s all worth it.

There are many things to consider before looking for a property, and it requires a proper and in-depth search for purchasing a particular property. However, sometimes many individuals want to avoid involving themselves in such a hectic task, so they seek help from brokers.

With the current inflation rate, the price of products and properties varies drastically. If you compare the current pricing of a piece of land, it costs more than 95% more than it was available a few decades ago. Let’s understand the factors affecting value of the property and how to buy a valuable property in the future.

What Determines the Value of the Property?

Determining the property’s value can be critical for sellers and buyers. However, with the current pricing scenario, a certain amount can be considered before buying a property. However, it becomes hard most of the time due to low money. Though, there is no universal formula to calculate the value of the property.

Many factors determine the value of a property, such as:

  • Location
  • Amenities
  • Neighbourhood
  • Size of the property

Usually, these four factors affect the property’s price to a major extent, and such a variation makes it harder to assume the price of any property.

Factors Affecting Value of the Property

Many factors fluctuate the value of the property in several ways. Some factors are as follows:

1: Tax

It is well-known that taxes play a big role in making up the country’s GDP and profit. However, a higher amount of taxes evaluates the property price. Sometimes, the property tax rises suddenly due to the extreme tax that makes it hard for the individual to buy their dream property.

Also, taxes affect the value, which usually disturbs the monthly payment. Let’s say someone wants to purchase a property but, due to the EMI’s structure, making difficult to survive.

2: Location And Amenities

These two factors are the most important while looking for a property, and these factors determine a major portion of the money required to develop the property.


Location is the prime factor that determines the value of a property. Generally, the locations that come under posh areas have more prices than common areas in the city. Most of the time, locations having higher developed areas have more amount. It makes the costs of a particular apartment or a piece of land high.


The valuation of properties with better infrastructure and modern amenities is costlier than those without proper electric connections, telephone lines, and water sewerage facilities. Other infrastructures include community centres, children’s parks, swimming pools, gymnasiums, parking lots, and general stores. Property valuation depends on the availability of facilities with the connected neighbourhood and appropriate housing.

3: Infrastructural Design

The infrastructure of the building is another essential factor that determines the cost of the building, and it influences real estate prices to a major extent. The presence of roads, airports, flyovers, malls and bus terminals, and other facilities add to the actual costs of the property.

The most crucial factor that affects the cost of the property is connectivity. In developed areas, the property price will be higher, whereas underdeveloped areas have a lower cost. It leads to a rise in the property valuation that connects entertainment hubs, medical facilities, retail, and other day-to-day facilities.

4: Commercial Real Estate

In India, places with commercial offices and hubs for employment have high living costs. For example, in India, places such as Noida, Gurgaon, Pune, Hyderabad, Navi Mumbai, and Andheri-Borivali in Mumbai have high prices when it comes to purchasing a property.

The development of malls, IT offices, and economic zones near residential areas helps to cut the time and energy wasted on commutation.

5: Disposable Income and Availability of Lands

Disposable lands

Disposable lands refer to the lands in the agricultural areas dominated by the manufacturing units. However, such properties have lower prices compared to the lands in India’s IT hubs. Property valuation is directly proportional to the quantum of disposable income in the majority population area.

Availability of Lands

Everybody wants to get settled in an area where access to markets, hospitals, schools, and other daily needs is easily possible. Most of the time, such places have less residential land available due to the high settlement of the population. Places in remote areas have higher chances of land being available at reasonable prices.

6: Affordability

It is the cost incurred by the owner in living and enjoying their residential place. It is a term used to establish a relationship between interest rates, property prices, and wages.

The most crucial factor is the property price which brings the buyer’s interest to the property.

7: Customization

After purchasing the property, individuals usually customize the property with their designs, making them live according to their demands. However, customization is also expensive these days. For example, some buyers want a landscape verandah, whereas some want a lobby. Such customizations change the cost of the building. Also, there are many such changes like a modular kitchen, and additional furniture costs a lot more. The higher the modifications, more will be the price of the property.

These are the factors that affect the value of the property.


The rise in price affects the living standards of the population. Due to this, individuals tend to live in rough conditions because of the low pay structure and high cost of living. There are many factors affecting value of the property. However, suppose the price of houses and properties reduces to some extent. In that case, it will be a secure option for individuals to live freely without being concerned with their lifestyle and future savings.

Building a house is a dream of many, but due to the high cost of living, this dream shatters drastically.


Which factors have a considerable impact on the value of the property?

Many factors affect the value of the property. Age and condition have the highest impact rate on the value of the property.

What improves property value?

Maintaining the house, adding high-quality materials while building the property, and adding good quality products have more value.

Also, the vital factor is the size of the property. The greater the property size, the higher will be the reselling value.

Is it worth looking for the value of the property?

No individual wants to pay for a deteriorated property. The cost of living is high, and so is the property cost.

Everybody will be willing to buy the property with a better market value.

Six factors affecting value of the property?

Many factors affect the price of the property in many terms. Property prices vary with many possible terms and conditions. Several factors are as follows:

  • Customization
  • Infrasture design
  • Size of the property
  • Affordability
  • Availability of lands
  • Location and amenities

What reduces the value of the property?

The inflammation rate and the change in the real estate market have higher chances of drastically reducing the property’s value.

How to maintain the property?

For maintaining a property, ensure the property value is at a higher rate. Simply, maintaining the property by performing renovations every second year and maintaining the water retention level in the walls.

What are the crucial factors influencing the value of the property?

Factors include quality and cost of the material used during construction, size, current labour rates, and other physical attributes such as roof and verandah. Such factors play a crucial role in influencing the property of the property.