Skip to content

Pricing a home’s history

March 12, 2014
by admin

It’s hard to put a price on history. A home where author Harriet Beecher Stowe reportedly rented a room to write “Uncle Tom’s Cabin” is on the market for $3 million, according to The Wall Street Journal.

The clapboard house in Brunswick, Maine, is valued by one real estate research firm at approximately $246,000. The 3,500 square-foot, six-bedroom, one-bathroom house was built in the late 1700s and has been owned by the same family since the early 1900s. The family claims Stowe rented rooms on the second floor in 1850 and 1851.

Appraisers not always convinced

John Walsh, president of Total Mortgage Services, Milford, Conn., says that adding a premium to the price of a home due to its history is highly subjective. It’s difficult to sell to an appraiser or lender.

“Just because a famous person lived there or a historical event happened in a home, it doesn’t typically translate into additional value in the eyes of an appraiser,” Walsh says.

A home’s value is typically determined by comparing recent sales prices of similar homes in the area, he adds. But unless the seller is in Beverly Hills, where famous people live in proximity, it’s not usually feasible to find another home with a similar pedigree.

The buyer ultimately determines the value of history

In the end, it comes down to what a buyer is willing to pay for history, above the appraised value of the home. “The perception of value of the historical home or a home a famous person previously owned is really in the eye of the beholder,” says Walsh.

“A person may consider an event or person important enough to pay a significant premium, whereas some people look at the same home as just a place to live and don’t see any reason to pay a premium.”

Keep up with your wealth and mortgages and follow me on Twitter: @JudyMartel.

Get real-time rate quotes with Bankrate’s Mortgage app.

Comments are closed.