As the real estate market gets busy this spring and the weather warms up, you may consider remodeling your home. Regardless of if you’re looking to sell, you’ll likely want to spend money on renovations that’ll get you the best return on investment. Here are some things to consider when upgrading your home:
Consider the Potential Return
According to Remodeling Magazine’s 2018 Cost vs. Value Report, garage door replacements recoup costs better than the 20 other popular remodeling projects that the study assessed. Other projects like installing manufactured stone veneer to the home’s exterior, entry-door replacement and midrange bathroom remodels all ranked highly and recouped more than 70% of costs.
If you’re remodeling your home to get it ready to sell, you have some big decisions to make, like where to start and what’s worth the costs.
The study averaged the different project costs across the country and compared it to the value added during resale, according to local real estate professionals. This is something you could do on your own after you have an idea for a project.
Look at Price Trends
The remodeling business is affected by many factors, such as cost of materials, demand, location and seasonality. Remodeling Magazine reported a slight decline in the average payback for the 20 projects assessed due to building costs increasing and post-renovation values only rising for two-thirds of the projects.
They expect those trends to continue into 2018 and note that the results were calculated before last year’s hurricanes which can affect demand in distribution and building materials, causing prices to rise.
Research the Real Estate Market
If you’re trying to decide which projects to undertake, look at homes around you, especially if you’re interested in selling in the near future. Once you do a little research on the local market, make a list and be sure your home checks all the boxes with potential buyers. Most people in the market have their own check lists when looking at homes.
How old is the roof? Is there a deck or patio? What are your neighbors updating? How much are similar houses in the neighbor selling for?
This will give you a good idea of what people like in your area, whether it’s a kitchen remodel, brick patio or updated bathrooms. Remodeling to suit unique tastes probably won’t help resale value, so it’s best to follow the trend of what’s selling. Talk to a local real estate professional for tips and advice specific to your area.
Replace & Repair
When it comes to resale value, replacing or repairing are probably better than adding on or renovating your home. Making small repairs and updates, like replacing old appliances or installing new countertops, will recoup costs a lot easier than a full-scale renovation and will be easier on your budget. If you’re planning on staying, you may want to do a larger remodel, since you’re likely not going to recoup most of the costs and can enjoy the new and improved space.
Don’t Overdo It
Putting a fortune into a new remodel doesn’t necessarily mean you’re going to get more back. When it comes to home remodeling, cost doesn’t equal value. Doing too much also might not fit the buyer’s tastes, or could price your home out of the market. Doing a major renovation just to sell might disappoint when it comes to resale value.
According to Remodeling Magazine’s report, the average recouped costs for remodeling projects was less than 60 percent. For the most part, they found that less expensive projects generally have a higher return on investment, while more expensive projects tend to cost more with less return.
Plan for the Future
Consider what the future will look like, whether it’s a popular trend in design or up-and-coming home features, like smart devices. Door bells with cameras link to phones now, so appealing to the next generation could help your home sell. Younger generations may also prefer certain features, like brick fire pits or screened-in porches. You can check new home construction or talk to a real estate professional to see what features are popular with younger buyers and get a good sense of what the future market might look like.
Plan DIY Projects
Curb appeal goes a long way when you’re trying to sell your house. There are plenty of projects you can handle yourself that will increase its value, whether it’s replacing kitchen cabinets or just some simple landscaping. Adding shrubs or flowers can help elevate your yard and grab the attention of potential buyers. Also, trimming trees around the house could boost the natural light inside. While fresh paint can make your house look inviting and new.
Hire Professionals for Bigger Jobs
If you want to do a major renovation to enjoy now, like adding an addition or detached garage, you might want to consider hiring professionals. It might cost less to hire a pro and likely take less time. Ask friends, relatives or coworkers for general contractor references. You might want to talk to multiple contractors to compare prices and past projects. You can also check online reviews and research costs before you get an estimate.
Remodeling can get you a good return on investment if you take on the right projects at the right time. With a little planning, you can gain a competitive edge in a busy real estate market.
This article is for educational purposes only, and is not intended to provide medical or legal advice, or to indicate the availability or suitability of any product or service for your unique circumstances.
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