Why 'Potential' Is Not a Property Feature
Buyers often pay real money for imagined upside. Here's why 'potential' should be treated with skepticism until it's backed by numbers.
Buyers talk about "potential" as if it were a feature of the house. Usually it is not. Usually it is a story about what the house might become after time, money, risk, and effort.
That distinction matters. An unfinished basement is not extra living space yet. A dated kitchen is not a future dream kitchen yet. A possible addition is not usable square footage yet. Until the upside is realistic, affordable, and likely, it should be treated as uncertainty.
This is where people get into trouble. They pay today's price for tomorrow's imagined version of the property, then discover the renovation is harder, slower, or more expensive than expected. The upside was never free, but they priced it as if it were.
A better method is to score the house as it exists today. If you want to model future upside, do it separately and include real costs, time, and execution risk. That keeps hope from quietly inflating the property's value in your mind.
Potential can be real. But until it is backed by numbers, it should not carry the same weight as something the property already has.
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