Putting a value on the stand
CONSIDER RESALE What percentage of the purchase price can be attributed to the land component? “In quite a number of cases these days, buyers are putting very little value on the bricks and mortar of an existing home and are purchasing properties to gain access to land in a prime location. This is especially evident in areas such as Constantia and Clifton in Cape Town and Sandhurst and Rosebank in Johannesburg, where older homes are being demolished to make way for new houses and townhouses on choice parcels of land,” says Richard Gray, Harcourts Africa CEO.
However, it does not y follow that the bigger the stand the more the buyer will pay for it. “Depending on buyer requirements, the usability of a stand frequently outweighs the importance of its size when it comes to calculating its value. Market conditions also enter into the equation. When the number of homes for sale is high and buyer demand is low, buyers are usually unwilling to make concessions on stand size, shape and character. It is wise to consider the way the stand will affect the resale potential of a property before you buy it. You should bear in mind that buyer preferences can change and a home on a substandard stand could be difficult to sell in the future.”