Simplifying Home Improvements
There are an abundance of articles online revolving around home improvement from DIY to trends. There are also many posts about which projects bring the best return for the investment. You may want to bookmark this post and save the useful links.
I'd like to bring it all down to earth and simplify things for buyers, new homeowners and homeowners that are preparing to sell with applicable tips.
What is your goal beyond just a fair return for your spend on home improvement? Will the improvements add to the quality of your life? Also, can you balance your wants with realistically increasing your home's worth? Are you engaging in home improvement with the intention of selling?
House Value - A Simple Place to Start
- Inexpensive DIY Home Improvements
- Best Replacement & Remodeling Projects
- Energy-Efficient & Eco-Friendly Upgrades
In addition these categories, consider if it's wise to replace, update or remodel. Replacing and updating is likely to yield the a better return over remodeling, however, in some cases remodeling may be the only answer if a home's feature / functionality is suffering.
It's also important to understand actual increased house value is different than perceived value; both are important to sellers. I'll explain more about perceived value later in this post.
DIY Home Improvements Around $150.00
These DIY are budget friendly and fall into the "perceived value" category. Give a kitchen a whole new look without replacing the existing cabinets, sand, stain and add molding to them. Frame your front door surround with attractive millwork, adding depth and character; choose paint colors that coordinate well with your home's exterior.
A choice of new lighting fixture can add ambiance, warmth mood or brilliance to a room. Layer lights thoughtfully in a room for both mood or needed functionality. If you can only do one fixture in an area, dimmer switches are desirable allowing different levels of illumination.
Have carpets professionally cleaned, and usually yields much better results, coupons come in handy here.
Here's a list of inexpensive, beautifying projects from the DIY Network.
Not only do these projects help with great first impressions, but are budget friendly and do-able for most folks. There are many things a homeowner can do to improve their house value without hiring a contractor, or barter for with beer and pizza if they know a amicable handyman provided you buy the materials. :)
Best Replacement & Remodeling Home Improvements
Kitchens still seem to top the list for popular remodeling projects, followed by bathrooms. Interestingly, front doors seem give the best rate of return. Front doors are important and a key part of a property's curb appeal with a return of around 100% for steel doors. The front door says a lot about a home, and an important part of a home's personality. Think of what buyers see first when they come to view the home.
Here's an excellent remodeling cost vs. value report showing rates of return by national, state and city locations with comparisons. Enthusiastic homeowners shouldn't expect a 100% return or better on most projects, so why bother? Perceived value, and I'll talk about that at the end of this post.
Energy Efficiency & Eco-Friendly Home Improvement
Be careful here, not all upgrades of these types yield a good return and a good time to point out it's important to not be "over the top" if you want a good return when you sell. True, more buyers these days are concerned about energy efficiency and growing interest in being eco-friendly.
Here's a list of the top 10 energy efficiency projects from Money.USNews.com
Perceived Value & Fair Market Value
If you review all these projects, you'll begin to realize that while some projects increase a property's value, they may not provide 100% return for your investment. So why bother, right?
Ever heard expressions like "You're paying for the brand", "You're paying for the fancy packaging"? Don't consumers "buy the pretty package"? It's like generic or hand-me-downs compared to recognized brands or simply "brand new". Do you want thrift store, or straight from the manufacturer?
Picture two homes in the same neighborhood. Each home is a ranch style, both are three bed, one and a half bathrooms and attached two car garage, same number of rooms overall and roughly the same square footage. Let's say you dump $20,000 into a kitchen overhaul, with stunning cabinets, lighting, fixtures, top notch counter tops, install an island and increase the storage, and possibly throw in shiny new high end appliances. Does that make the home worth $20,000 more? No. It does help justify the asking price in the buyers eye's though.
Again, why bother? It's because of "perceived value". Do you want to sell that home? Matching feature to feature, these homes are the same, but place yourself in the buyer's shoes. Most buyers these days want "move-in-condition", or at least something that requires little work to make it satisfactorily their own.
If the kitchens are the same size, but one is outdated and the other is tastefully done it helps to justify the asking price. It's all about desirability. If features match, even if the upgraded home has a bit higher asking price the property is likely to generate and hold a lot more interest from buyers. If the homes are basically the same, but one has thirty year old siding, and other has newer, more attractive siding which one are you more likely to have interest in? One of your best bets for success is to talk to a seasoned Realtor with a great track record.
Don't overdo it;
A word of caution on updating and remodeling if you intend to sell. Be careful about going "over-the-top". Choose the most obvious flaws and features that are turn-offs and focus on those along with inexpensive simple or easy cosmetics. My advice is don't go cheap, but "spare no expense" isn't going to give you a good return if you're selling. Stay in the middle ground with good, but affordable quality materials. Stay relatively neutral in your material choices too. Going over the top can lead to bitter disappointment.
Use bargaining chips! In some cases, rather than undertaking some projects prior to listing, you can throw in tantalizing incentives like allowances for carpet or appliances. Buyers love having some choice, and offering incentives like these allow for tempting flexibility.