Many sellers think that spending money on expensive and extensive home improvement projects before they put their home on the market is a good investment. But, remodeling in order to sell for a significantly higher price isn’t always realistic. In most cases, while a big project will probably help you sell your home faster and will somewhat increase the asking price, don’t expect a dollar for dollar return on your investment.
If you are thinking of making expensive changes, talk to your real estate agent before you call the contractor and ask whether your home needs a big remodeling project or just some minor changes.
Home buyers expect a house to be fully up to code, with a working furnace, air conditioner, hot water heater, electrical system, plumbing and a good roof. If there are any problems with these, you’ll need to have them repaired or replaced, unless you’re selling a fixer-upper. This won’t bring you more money, but, improvements such as better insulation and high-efficiency furnaces pay for themselves in long-term cost savings. Buyers know this and will spend extra for a home with these upgrades.
If you decide to redo your kitchen or bath, you can expect to recoup only about 75 percent of the cost. There are some exceptions; If your home has only one or two bathrooms, consider adding another to create a master bed/bath combination.
Basement remodels can be expensive and usually bring in only about 50 to 80 percent of the cost, but a newly redone basement living space is a good place for that extra bathroom or an additional bedroom adding to the square footage – and the price – of your home.
If you are considering expanding living space with an add-on, don’t do it at the expense of outdoor space or that garage. People want a yard for relaxing and socializing and a garage for storage and for their vehicles. Consider instead adding a deck, which is a good investment and one of the few that will often payback more than it costs.
A sunny and efficient kitchen can be a big selling point. Sometimes, replacing the old and worn-out appliances, refacing the cabinets and putting in new countertops may be all you need to do. When redoing a kitchen, putting hand-painted Italian tile backsplash in a $200,000 home won’t increase the price, while expensive touches are expected in a $500,000 house. When you sell, offer to leave the new dishwasher, refrigerator and stove with the home and look for Energy Star appliances when you buy.
If your windows are old and leak heat, consider replacing them with new high-quality energy efficient windows. Don’t bother putting in cheap windows – buyers can tell the difference and you’ll just be wasting your money.
Today, home buyers are looking for bargains. Having a beautiful home will help sell it quicker and for more money. But, don’t put time and money into projects that won’t help sell your home. Some projects are worthwhile and others are not. Know the difference.
Contact Mike Oscarson for more information and a home analysis, to see what, if any, improvements would increase your home’s saleabilty.
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