What Does Really Matter When Buying or Selling a Property?

A few years ago, I had a conversation about using AI to value properties with a chap who had just bought his first property. His first reaction total denial! “Does AI understand the additional value if the house has a south-facing garden?” The first thing he asked.

While it’s given that here in the UK, south-facing gardens can add some value, there are far more important things that determine the bulk of the house price. I would say that about 90% of the value is determined by a few key variables: location, size, condition and restrictive covenant (if applicable). Everything else is just detail.

Purpose-built AI (not ChatGPT) can determine the objective value of any property better than most surveyors, instantly. The remaining 10% of the value is subjective and can be agreed (or disagreed) in negotiation.

The rental value of a house is highly influenced by the house value, and the location. This combination gives us the “yield”. Simply put, higher yield means better return on investment can be realised if the property is let.

The third factor that’s almost always neglected by first time buyers is the liquidity. In simple terms, the liquidity is an indicator of how fast the house can be sold at its “fair price”. Indeed, many fancy mansions in rural areas are sold for peanuts because they are very hard to resell (and lenders won’t finance the deal).

Again, liquidity is highly influenced by the location, as well as the house price.

But where can you get all the three key values? And how much would it cost you?

Here is the good news. AccuVal provides these key values and a lot more instantly and completely free of charge for individuals (there is an API for businesses too).

15-04-2024