Whether you're putting your home on the
market this year or in the next five years, it is a smart decision to start
building your home's resale value now. Here are some ways to create a
comfortable home while making it easier to put more money into your bank
account on closing day.
Small Maintenance and Repairs
If you think that home maintenance on the
weekends waste your time and energy, think again. The small chores you do
around your home prevents it from losing value. Neglecting small maintenance
and repairs causes 10% of your home's value to walk out your door and slip
through your windows. Most appraisers claim that homes showing little to no
preventative maintenance can depreciate from $15,000 to $20,000.
A study conducted by researchers at the University of Connecticut and
Syracuse University shows that regular maintenance boosts your home value by
about 1% per year. However, ongoing maintenance costs offset that value, which
means that regular maintenance actually slows down your rate of depreciation.
Furthermore, because homebuyers generally notice any repairs needed upon buying
a new home, proactive maintenance lets the homebuyer know that he or she will
not have to spend extra money to maintain the basics. This makes your home more attractive,
and thus more likely to get higher priced offers.
Maintaining the basics can cost you little
money and certainly some effort, but there’s a way to accomplish this very
important activity smartly. This article by HouseLogic, for example, shows you how to keep home maintenance below $300 a year. Planning ahead will also help make
maintaining your home easier. Most professional appraisers and real estate
agents recommend a proactive maintenance schedule that includes:
·
Keeping enough cash on hand to
replace systems and materials
·
Creating and following a
maintenance schedule
·
Planning a room redo every year
·
Keeping a notebook of all your
maintenance and repairs
Landscaping
The Virginia Cooperative Extension at Virginia Tech published a study that shows landscaping can increase a home's
value by 15%. The study claims that a
home valued at $150,000 could increase its value between $8,300 and $19,000
with the addition of landscaping. Particular landscape elements add different
value. For instance, landscape design can increase your home's value by 42%,
plant size can increase your home's value by 32%, and diversity in plants can
increase your home's value by 22%.
Replace Entrance Doors
If your entry doors are wood, consider
switching them out for either fiberglass or steel doors. Steel doors add style
and architectural interest to your home while improving security; you can add a
deadbolt and electronic keypads to keep out intruders. Unlike wood doors, steel
doors do not rot or splinter.
Alternatively, fiberglass doors can be
designed to look like wood doors and give your home a modern look. Fiberglass
doors conserve more energy than steel doors.
Pricewise, a steel door will cost you $1,335
with a 91% return on investment whereas a fiberglass door will cost you $3,126
with an 82.3% return on investment.
Garage Door Replacement
At first, you might not think that your
garage door increases the value of your home. However, your garage door
distinguishes your home from the other homes on your block. As the largest
entryway of a house, garage doors get noticed first because they're the focal
point of your home. If you want to quickly increase the resale value of your
home, you need to make the most of this space.
Some interesting things being done with
garage doors include:
- Increased Size: Bigger
garage doors help homes stand out more, and homeowners can do more
creatively with them.
- Bold Colors: Bright
and bold colors now can complement the color of your home, or you can
build a concept around the color of your home.
- Faux Wood: You
can install fiberglass or steel garage doors that look like wood garage
doors. This gives your home a new level of sophistication.
- Windows: Large
Windows on your garage door improve the aesthetic of your home, and
provide light into your garage so that it's no longer a dark space.
More importantly, a garage door replacement
will cost you $1,652 and add $1,512 to the value of your home; that's a return
on your investment of 91.5%.
Fiberglass Attic Insulation
While energy efficiency is still not the
sexiest selling point of your home, installing fiberglass attic insulation
saves energy and garners a big payback on your investment. According to
Remodeling Magazine's 2016 Cost vs. Value top trends report, fiberglass attic insulation gained the top return on
investment among the 30 projects in this year's report. Using Remodel/Max as
the cost source, a fiberglass attic insulation project cost $1,268
nationwide. Real estate professionals
surveyed estimated that the work would boost the price of a home at resale,
within a year of its completion, by $1,482. That's a 116.9% return on
investment.
Replacing Windows
Replacing your windows is another way to save
energy and increase your home's resale value. Replacing your old windows with
energy saving models will beautify your home, keep it comfortable, and ease the
workload of your HVAC system. According to HGTV, you'll see a reduction in your utility bill by 7% to 15%.
However, if you're selling your home, you could expect a 60% to 70% recoupment
of your investment. The two types of replacement windows that fetch the best return are vinyl and wood.
Remodeling Your Kitchen
Kitchen remodeling can get expensive, but
small renovations can make your home more buyer friendly. Changing your
kitchen's texture and color using a matte finish and neutral colors such as
putty or grey enhances your home's resale value. Because matte finishes have
transitional qualities, your potential homebuyer can easily match his or her
stainless steel or black and white appliances. Also, refinishing cabinetry, or
switching to Energy Star™ appliances provide comfort you like and pizazz buyers
adore.
Flow is important to any interior design of a
home. If you feel that your kitchen hinders a good flow, change it. A small
investment to knock out a non-structural wall or remove a kitchen island creates
space and provides flow that buyers love.
A minor kitchen remodel can cost you $20,122
while putting $16,716 of resale value into your home; that's an 83% payback on
the project. If you want to do a major kitchen model, this can cost you about $60,000
and put about $39,000 of resale value into your home, which is only about a 65%
payback on the project. Therefore, consider a minor kitchen remodel first.
Bathroom Addition or Remodel
Likewise, carefully consider adding a
bathroom or remodeling your bathroom. Switching out your frosted glass shower
doors for glass doors, cleaning the grout, replacing the shower and floor
tiles, switching out your sink or toilet, or replacing your sink and shower
fixtures can cost you little money.
Adding a bathroom can get expensive, but it
can reduce congestion during hectic times and provide your guests with a
bathroom. Consult with your real estate agent or a local appraiser before
deciding whether a full remodel or addition is right for your situation. While
a bathroom remodel will cost you about $18,000 with a return on investment of
about 66%, a bathroom addition will cost you about $42,000 with a return on
investment of about 56%. Therefore, it's best do your due diligence before
working on your bathroom.
Your Needs and Buyers' Wants
On that note, if you need to renovate
your home, be sure to consider how those changes will affect its appeal to
future buyers. Knowing design trends will give you the opportunity to make
changes to your home based on where your needs and your potential
buyer's desires intersect, thus increasing your property's resale value
drastically.
Designers and design websites provide
great ideas when you’re brainstorming home renovations. Keep in mind as you
research, however, that you don’t want to sacrifice your needs for a
comfortable home just for the sake of what you think a future buyer will want!
Therefore, before you begin making any
changes to your home, consult your real estate agent. Real estate agents,
because we are constantly working with new buyer clients, have insider insight
into what home buyers are looking for now and in the future. We’ll be able
to help you make smart choices when remodeling or renovating your home.
If you think you might want to remodel
or renovate your home in the near future, or if you are just curious about
other ways you can increase its resale value, please reach out to me!
