Posted by Steve Harmer on Monday, September 26th, 2016 at 11:43am.
I hear questions from prospective sellers all the time regarding home improvements and will they add value to the home. A common question is "I am worried that my home improvements are not going to pay off at all when I sell my house. Do all home improvements make financial sense?"
Not all home improvements make financial sense. Some homeowners make improvements because they want a particular feature or “feel, ” without regard to the cost. Be leery of articles in popular magazines that imply these improvements are an automatic financial benefit. Lists of the percentage gains on individual components, like a bathroom or kitchen remodel, are common. Every home must stand on its own two feet, not averages.
Background thoughts
Homeowners make improvements for different reasons; comfort, aesthetics, or to make a change. They often believe the improvement will increase home value above the improvement cost. This theory may not be correct. One makes judgments about which improvement projects to tackle, or forego, with facts. This advice is for homeowners who enjoy their home for a variety of reasons and want to improve it.
Here are seven tips to consider if you want your improvements to increase value.
There are compelling reason to look at home improvements with a critical eye. Here are some considerations:
Seven insightful tips
The quality of installation is important. Consider learning Do-It-Yourself projects somewhere besides your home. Be cautious of the tradesman who will quote a very low price. Find a contractor who has done many similar projects and view examples of their work. There are too many three months long projects that take two years to finish only to end up with a botched job.
Use MLS data to determining the viability of a project. Assume bringing your 25-year-old kitchen up-to-date with new cupboards, countertops, appliances, and the works. A real estate agent can show you six similar home sales, three with and three without a new kitchen. Compare the difference in sale price against the proposed cost to get a sense of a gain, or loss.
Finally, one project can easily lead to another. When you finish the kitchen, suddenly, the bathroom looks fatigued.
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