Residential Property
When looking at residential
properties, location is often the biggest factor in appreciation. As the
neighborhood around a home evolves, adding transit routes, schools,
shopping centers, playgrounds and so on, the value climbs. Of course,
this trend can also work in reverse, with home values falling as a
neighborhood decays.
Home improvements can also spur appreciation, and this is something a
property owner can directly control.
Putting in a new bathroom,
upgrading to a heated garage and remodeling to an open concept kitchen
are just some of the ways a property owner may try to increase the value
of a home. Many of these techniques have been refined to high-return
fixes by property flippers who specialize in adding value to a home in a
short time.
Commercial Property
Commercial property
gains value for the exact same reasons as the previous two types:
location, development and improvements. The best commercial properties
are in demand, and that drives the price up on them.
The Role of Inflation in Appreciation Of course, there is one major factor we skipped in our summary - the economic impact of inflation.
A 10% inflation of the dollar means that your dollar can only buy about
90% of the same good the following year, and that includes property. If
a piece of land was worth $100,000 in 1970, and it sat dormant,
undeveloped and unloved, it would still be worth many times more today.
Because of runaway inflation throughout the '70s and a steady pace
since, it would likely take over $560,000 to purchase that land today -
assuming $100,000 was fair market value at the time and all other
factors remained constant.To know more visit our site http://allindiayellowpage.com.