Factors beyond size and style contribute to home value

A recent article from Bloomberg Businessweek examined the expensive housing markets and explained the factors that contribute to the elevated cost in such areas.

While size and style are two of the more deciding factors for a home's value, location is just as important. According to Andrew Schiller, the founder and chief executive of real estate website NeighborhoodScout, two key drivers of value are access to work opportunities and access to amenities.

"Access to opportunity is so significant that even if homes are smaller, the values [in an area] can still go up," said Schiller. "People will put up [with] a lot to make a lot of money and support their families." Housing developments in Beverly Hills, California, and Manhattan, New York, are attractive for these reasons.

Access to amenities is trickier, Schiller explains, as certain amenities can lose value and make areas less attractive. High-priced markets offering great views or proximity to outdoor recreation can become less desirable during harsh economic times. For example, home values in Port Royal, Florida, a popular area because of its waterfront views, have dropped 21 percent during the last two years. However, amenities, such as views or waterfront accessibility, normally can significantly increase a home's value.

While home sales are set to decrease by 2.3 percent during 2011, as Reuters reports, the prices of those in proximity to job centers or amenities might not see a similar drop.  

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