Short answer, yes certain home improvement project will increase the value of your home but probably not as much as you expect them too. If you are simply performing the home improvements in order to resell the house… don’t splurge. You will end up spending way more than you recoup. It’s a game of balance where certain investments will help increase the value of the home more than initial investment while others will just end up costing you more but gaining less.
Here are three of the most important improvement projects that homeowners tend to work on before selling a house. Some of them as you will see are statistically known for producing value while others tend to do the absolute opposite.
Unfortunately most improvement projects actually have a return on investment that is less than the amount necessary to complete the project so before we begin looking at each category separately decide for yourself why it is you are doing this project. If it is strictly for resale purposes financially it will make no sense, but if you plan on living in the house for a little bit more time and can personally benefit from these project… go right ahead in most cases.
Full Kitchen Remodel
The average amount homeowners recoup from a kitchen remodel during the sale of the home is 70%… although this means that if you spend $15,000 on a remodel you will only end up taking $10,500 back.
Not a very attractive number on paper necessarily but definitely something that homeowners should consider nonetheless. In the 2017 real estate market certain homes are almost impossible to sell for true market value if important aspects of the home are not up to par with the rest of the homes available on market.
The kitchen is considered the heart of every home according to 99% of realtors and basically every interior designer ever. The main attention of a new home buyer is always surrounding the kitchen. Which means an un-remodeled kitchen may be the aspect that causes home buyers to turn away from your home or underbid.
This is what we recommend focusing on if you would like to remodel on a budget and get the biggest return down the road:
Countertops: Nobody likes laminate countertops anymore, absolutely nobody. They are outdated, old looking, and the first thing that has to go. If you end up doing any remodeling work of the kitchen get stone countertops.
For as little as a $2,000 or $3,000 you can give your kitchen the ultimate facelift and guarantee that sale.
Resurface Cabinets: Cabinetry is also a very important factor in the kitchen. After the counters the cabinets draw the most attention, if they are worn or old they make the whole room look unpleasant and uncomfortable to be in. No potential home buyer wants a house with akitchen that gives an unpleasant feeling.
For as little as a few hundred dollars you can resurface the cabinets in your kitchen yourself with a DIY kit or have them professionally resurfaced.
Full Bathroom Remodel
The bathroom, like the kitchen is what sells the house. Every potential home buyer first checks the kitchen and next looks at the bathrooms. If your bathrooms are old and outdated it’s a big turn off for buyers.
On average bathroom remodels range from as little as $1,000 to $7,000.
Nationwide the average value recouped from a bathroom remodel is around 60%… however in busy real estate markets bathroom yields can yield over 100% ROI sometimes coming close to even doubling your investment at 200% ROI.
The most effective way to polish up your bathroom…
Installing fresh countertops: If your bathroom vanity is still laminate it is a good idea to consider switching over to a natural stone countertop.
New Floors: Replacing a simple 5x8 area from sheet vinyl or linoleum to porcelain tile will cost just $500-$600 but will increase the rooms appeal ten fold.
Don’t just think about the bathroom remodel as necessary to resell your home. If you approach it with that motive you may not make wise decisions while remodeling and end up hurting the look of the bathroom rather than helping.
When remodeling for resale it is important to be financially conscious regarding every incurred expense. Try to save as much as possible on all of the little details because all of the savings you make means more dollars in your pocket once you sell the house. Common sense but definitely something that you should pay attention to.
Don’t spend a ton of money on high end materials or expensive fixtures and utilities. A potential buyer doesn’t know the difference between a $2.50 a sqft tile and a $8.00 a sqft tile. Nor does the buyer know the difference between an expensive faucet or a cheaper one. Your goal is to save money and not overspend.
Repainting your Home
The third and final home improvement project that we recommend homeowners take on before selling a home is a full house repaint. In terms of surface area your walls take up the most space and draw the most attention to themselves. If everything else in your home is flawless but the walls have dings in them or are simply faded will give a completely wrong impression.
The way the home looks from both the inside and out speaks to how it was taken care of over the years. Potential home buyers will be very weary of purchasing a home that looks as though nobody ever took care of it.
Periodically refreshing the paint job ensures that the home doesn’t develop problems such as mold and rot. A fresh coat of paint on the inside and out in a neutral non flashy color will give your home curb appeal and brownie points with the potential buyers.
To reiterate the question we first began to answer; will home improvement project really increase the value of your home?
They will increase the value of your home, maybe not as significantly as many imagine but none the less crucial. Certain home improvement projects will generate over 100% return in high demand markets while in other areas of the country it will be more difficult to recoup the expenses.
Bottom line if you would like to sell your house even at fair market value it needs to be both presentable and desirable for a potential buyer. If you don't remodel certain aspects of the home it won’t have the traits that a move in ready family is looking for. Meaning they will skip out on your home and go for something more fresh and clean.