In such a case where prospective buyers’ are willing to pay for the location value, the calculation stands nullified. This happens mostly in established areas which has a premium attached to it. Consider an area where land bank is scarce and is extremely difficult to find a new plot for construction.To this building price, add the price of land arrived at through market benchmarking to get the total price for the house. Therefore, the remainder of the useful age is the price you can ask for the building component. Suppose you are selling it after 20 years of construction, selling price of the building minus depreciation is arrived at by this simple formula- Number of years after construction/ Total (useful) age of the building. In case of an independent house, the total useful age is estimated to be about 60 years. While the value of the land needs to be benchmarked to the market price, the value of the building depends upon its age. In case of an independent house, the value of the house is sum of the value of the land and construction cost of the building. Magicbricks reached out to Ajay Sharma, DGM, Valuations and Consulting, HDFC Realty who gives the following insights. Exceptions apart, a very old construction will not be able to gather as much buyer interest or money. It is for the simple reason that a building like everything else has an age too. Since the value of property depreciates with every passing year, what factors should I keep in mind?” My problem is that I am unable to calculate the selling price. Ranjani Karthikeyan from Bengaluru asks, “My property is 20-years old and I wish to sell it because I am moving abroad.
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