Determining whether or not a derelict mansion is a good value depends on the degree of its dilapidation, the value of the surrounding homes and the condition of its neighborhood. It also depends on the personal needs and preferences of the buyer, including the intended purpose of the mansion.
One of the biggest factors to consider regarding the value of a derelict mansion is its overall condition, as it signifies the true extent of its cost. For example, a mansion that has a great deal of exterior damage but a sturdy and undamaged foundation may only require cosmetic repairs and thus have a lower total cost. However, if the mansion needs to undergo major construction to restore its structural integrity or to comply with housing codes, the final cost is likely much higher than the sale price. Buyers should factor in all restoration costs to understand the true value of the home.
It is also important for buyers to consider the median home value within the neighborhood to discover if the mansion price is too high for the market or if it is appropriately lower. Other factors that influence property value include the condition of other homes in the neighborhood, proximity to local conveniences and the size of the estate beyond the mansion. The buyer also needs to think about her plans for the home, as someone who plans to live in the mansion may be more comfortable with a high restoration price compared to someone who wants to sell the home immediately.