What raises and what lowers the value of an apartment, a complete guide for buyers and sellers

What raises and what lowers the value of an apartment, a complete guide for buyers and sellers

The value of an apartment is a concept that seems obvious until it actually has to be determined. Two apartments of identical size, in the same city, can differ in price by tens of percent. Why? Because value is made up of dozens of factors, some of which are fixed and unchangeable, and some of which can be improved or worsened. Understanding this mechanism is crucial both for buyers who want to place their money well and for sellers who want to obtain the best possible price.

Let us start with factors that raise value and that practically cannot be changed. The first and most important is location. This concept covers much more than just the district. What matters is access to public transport, distance from tram and bus stops, proximity to an agglomeration railway station. What matters is the neighborhood of green areas, parks, boulevards, forests. What matters is access to schools, kindergartens, clinics, shops and recreation places. What matters is the prestige of the area and its direction of development. In Kraków the difference in price per square meter between prestigious districts and less valued ones can reach tens of percent, even with a similar apartment standard.

The second fixed factor is the floor and the presence of an elevator. In buildings with an elevator the highest valued floors are the middle and upper ones, due to quiet, the absence of passersby looking in, and a better view. The ground floor and first floor are usually cheaper, although a ground floor with a garden is an exception and reaches high prices among families with children. In buildings without an elevator the situation reverses. High floors without an elevator are clearly cheaper, because daily climbing of stairs is burdensome, especially for elderly people and families with small children.

The third fixed factor is the exposure of windows and sunlight. Apartments with windows facing south and west are valued higher, because they provide more natural light. Apartments with windows only facing north are usually cheaper. The view from the windows, the quiet, and whether the windows do not face directly the wall of a neighboring building also matter.

The fourth fixed factor is layout functionality. A functional apartment is one in which every square meter makes sense. Rooms are separate, not connecting. The kitchen has a window or is well lit. The hallway does not take up too much space. There are no dead spaces or strange angles difficult to use. A poorly laid out apartment, even with a large size, loses value because the genuinely usable space is smaller.

Let us move on to factors that raise value and that can be improved or created. The first is the energy class and maintenance costs. An energy efficient apartment with good insulation, new windows and an efficient heating source generates lower bills, which translates into higher market value. The second is the state of finishing. Fresh, neutral arrangement, a modern kitchen and bathroom significantly improve the first impression and the price. The third is additional elements such as a balcony, terrace, loggia, parking space, storage room, garage. Each of these elements has its measurable value. A parking space in the center of Kraków can be worth between 40 and even 90 thousand zlotys. The fourth is the absence of technical defects, meaning efficient ventilation, no damp, and a good electrical and plumbing installation.

Now factors that lower value and that are hard or costly to remove. The first is noisy or burdensome surroundings. A busy street, the neighborhood of a club, bar, disco, production plant, railway line or airport genuinely lowers the comfort of living and the value. The second is structural defects. Cracks, settling of the building, problems with the roof or foundations are factors that can drastically lower value and sometimes make an apartment very hard to sell. The third is damp and mold, which indicate problems with insulation or ventilation. The fourth is a complicated legal situation, meaning several co owners, unsettled inheritances, enforcement entries. The fifth is the absence of an elevator in a tall building and very high building administration fees, which effectively discourage buyers.

Finally, factors that lower value at the first impression stage but which are relatively easy to improve. Heavily worn, damaged finishing. Loud, unusual wall colors. Outdated fixtures and lighting. A neglected staircase and building entrance. Clutter, mess, an unpleasant smell. These elements spoil the first impression and lower the price, but their repair is cheap in relation to the effect. This is exactly why home staging and minor refreshing of an apartment before sale can be so worthwhile.

What conclusion follows from this list? Above all, that when buying an apartment it is worth investing in fixed features that cannot be changed. Location, floor, layout, exposure, these elements are given once and for all. An apartment in a great location but with outdated finishing is often an excellent investment, because finishing can be refreshed, while the location will work on value for decades. Conversely, a beautifully finished apartment in a poor location, on a high floor without an elevator, with windows facing a busy street, is often a worse investment, because the basic flaws cannot be removed.

For sellers the conclusion is equally practical. Focus your energy and budget on what genuinely improves the first impression and can be changed at low cost. Refreshing the walls, minor repairs, tidying up, professional photos. There is no point investing a fortune in a thorough renovation just before sale, because it rarely pays back fully. It is enough for the apartment to be clean, tidy and neutral.

At Eternel we help clients look at properties analytically, separating emotions from real value. For buyers this means pointing out which elements of an offer are lasting strengths and which are merely cosmetic. For sellers this means advising on what is worth investing in before sale and what is better left and used as an argument in negotiations. The value of an apartment is not a single number, but the result of many factors. The better we understand them, the better the decisions we make.