The value of the structure itself decreases over time, although real estate values typically increase. For tax reasons, residential structures in India usually depreciate at a rate of 1% to 2% a year. Now, coming back to your query, how to find out the resale value of flat after 20 years? The real market value of resale flats may differ depending on its location, demands and condition. Read on to know the formula to find the resale property’s value.
How to Find Resale Flat Value After 20 Years?
To estimate the cost of a 20-year-old flat in India, you can follow these steps:
Estimate the depreciated value of your property using the formula: Original Cost of Structure× (1−Depreciation Rate) ^Age of Flat.
Over time, let me tell you, depending on the location, land value in India might rise. To determine the current market value of the land per square foot in your area, you can speak with real estate experts.
Multiply the current land rate by the share of the land area associated with your flat.
Add the depreciated value of the flat and the current land value with additional expenses to get the total estimated cost.
Let’s understand the flat price after 20 years with an example. If a 20-year-old flat was originally purchased for ₹50 lakhs, and you assume a 1.5% depreciation rate over 20 years, then:
The structure depreciation value will be 50,00,000× (1−0.015) 20≈₹36,17,000, i.e., ₹36.17 lakh (as calculated based on the above formula),
The current land value share is estimated to be around ₹60 lakh.
Then the total cost of the flat would be:
Total Cost=36,17,000+60,00,000=₹96,17,000
I hope you understand how to find out the resale value of flat after 20 years.
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When we purchase a property we always look at the property's age, location, and amenities it is proving and then we check if the price of the property. I recently relocated to Mumbai and I was looking for an old property as I had heard that the price for old flats is on the lower side. I asked my brother who works in the real estate industry how to know the price of an old flat and what is the resale value of flat after 20 years.
He share with me a formula to get results about how to calculate 20 yr old flat cost in Mumbai:
Value or resale flat = value of undivided share of land + depreciated value of building and amenities + value of overheads, expenses, etc.
I hope you know how to calculate the resale value of flat after 20 years.
You can also check out the property listed on NoBroker and check their price value.
If you have a property to sell out quickly, list it on NoBroker for FREE
Read more:
How To Know The Price Of An Old Flat?
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Authors Of The Question
How to calculate 20yr old flat cost?
Alpa S
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3 Year
2021-11-29T10:13:29+00:00 2021-11-29T10:13:30+00:00Comment
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