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Whether you’re considering remodeling worn-out surroundings, enlarging your home for a growing family or rebelling against yesterday’s standards, you have important investment choices to make.
You will want to choose home improvements that not only pay off in recovery of
the money you spend, but also help you get a better price for your home when
and if you sell. Keep in mind, however, it may be a smarter move to sell and
buy again, in today’s market, rather than endure a major construction project.
After all, even an 80% recovery at resale is still a 20% loss.
Here’s how to divide the payoffs from the puffery.
1. Kitchen Renovation
New flooring, cabinets, countertops and appliances
can be costly, but buyers typically look for updated kitchens. You are likely
to recover a large percentage of your kitchen renovation expenses on resale.
If your basic kitchen plan is good, you may not need a major remodeling. Even
a minor facelift – painting, new floor covering, new cabinet doors and hardware,
for example – will pay off in a faster sale at a better price.
bets: light neutral colors, plenty of cabinet and counter space, new light fixtures,
and new energy efficient-appliances.
2. Bathroom Addition
Another bath is not only a convenience, it may sharply
enhance the sale possibilities of your home. Two and three bathrooms are standard
fare in many neighborhoods. Upgrading an existing bathroom is likely to pay off
in both value and marketability, especially in an older home.
Tip: Opt for good
lighting, large mirrors, easily cleaned materials, plenty of storage space, neutral
colors. Consider location and accessibility of an addition.
3. Room Addition
Adding a new room is likely to pay off if the addition
puts your home in the same class as others in your neighborhood. Family rooms,
sun rooms and master bedroom suites are hot items now – and the extra space may
be just what your family needs.
Tip: Choose materials and style to blend with
the existing house; consider traffic flow, accessibility to other rooms.
4. Deck or Patio Addition
Decks too make a home homier – as a gathering
place to extend family life outdoors – for Saturday barbecues, Sunday brunches,
mid-day respites. Best paybacks: decks or patios off living areas (kitchen, family
room, dining room), decks with a view or overlooking your own well-kept garden.
Tip: Build deck of redwood, cedar or pressure-treated wood; design deck or patio
to harmonize with the architecture of the house; consider a low-level deck for
5. Energy Efficiency Improvement
The major savings of improved energy efficiency will be in your fuel bills, but your energy-saving home will also likely pay off when you sell. If existing windows are drafty or unsightly, consider replacing with insulated windows for heating/cooling efficiency and resale value.
Tip: Minor energy upgrades are real winners: caulking and weather-stripping around doors and windows, attic insulation, set-back thermostat, heat-reflecting awnings or shades, water-heater insulation, ceiling fans for air circulation, good maintenance of heating/cooling system, and a whole-house electrical surge-suppressor to maintain appliance efficiency and protect electronic equipment. Many are do-it-yourself projects, which – if done correctly – bring the best paychecks.
1. Over improvements
Add the cost of your proposed remodeling project to the current market value of your home. If the total is more than 205 over average neighboring home values, you can’t expect to recoup your remodeling expenses if you sell.
Tip: To be sure your improvements are good investments ask me for a comparative market analysis to determine your home’s value range.
2. High-Cost Single-Use Improvements
It’s certainly pleasant to have a swimming pool to plunge into whenever the spirit moves you, and a tennis court on the back corner of your property would allow you to play without signing up for the court. But not every buyer wants such luxuries, and some are reluctant to buy a home with high-maintenance-cost features. You might have to wait some time to find buyers who are willing to pay the extra price that would allow you to recover your investment.
Tip: Consider carefully before you undertake a high-cost low-value remodeling project. You may decide to go ahead because the advantages for you outweigh the possible financial loss – but you should understand what you are getting into.
3. Flamboyant Architecture
You may – although you live in a ranch or colonial house – yearn for the gingerbread
that use to embellish your grandparents’ home, or the giant columns that graced
Tara in “Gone With The Wind.” You
might be crazy about pink stucco or really like thatched roofs. Fine, but understand
improvements that are not compatible with the way the rest of the house looks
will make it harder to find a buyer later.
Tip: Look for ways to get your heart’s desire without clashing with your house. Paint the shutters pink instead of covering the whole house in pink stucco, for example, or use the gingerbread embellishment on the gazebo in the back yard.
4. Inappropriate Interior Features
Here, again, personal preferences may displace resale sense, and that’s okay if you don’t mind eventually waiting for the unique buyer who shares your unique taste. If that’s the case, go ahead and put those gold fixtures in the bathroom, the do-it-yourself forest landscape on the kitchen wall, or the baroque chandelier in the dining room.
Tip: It may be worth the double expense to you to put your individual features into the house now and then replace the items when you put your home on the market.
5. Elaborate Landscaping
It’s hard for a genuine gardener to landscape inappropriately, but one owner’s dedication may be another owner’s nuisance. With resale and maintenance demands in mind, it’s a good idea to avoid potential problems: flower beds and shrubbery that require constant attention or even professional care, pathways of pebbles through which weeds peek, formal garden plots that look disreputable when nature insists on making growing things sprawl, picket fences that need frequent repainting, and complicated outdoor spotlighting that can require expensive repair.
Tip: Good landscaping adds much to a home’s value. Plan and plant with
your future resale in mind, and you will enjoy the yard more now, too.
Some of my clients are surprised to learn it may be easier to sell and buy again than to endure a major remodeling. Call me for up-to-the-minute real estate market information to help you make your decision.
7 Deadly Sins of Home Remodeling – 7 additional mistakes in remodeling to avoid if you want an edge over other home sellers in an iffy market.